Long-term loans on low markup vital for farmers to lift agri economy: PAAPAM

ISLAMABAD    -   Stressing the need for a long-term loan scheme on low markup for the farmers, the business community has said that the provincial government’s decision to launch a green tractor scheme will boost agriculture economy in Punjab and help stimulate national economy which is already showing signs of stability with stable value of the rupee, reduced inflation, and expected reduction in the interest rates. Appreciating the government plan of providing subsidies to the peasants for the purchase of tractors, the Pakistan Association of Automotive Parts and Accessories Manufacturers Chairman Abdur Rehman Aizaz said that the tractor subsidy schemes have been introduced in the past as well but last for one year, which creates a boom in the industry followed by a bust in the following year, which is detrimental for the industry. Mumsahd Ali, SVC PAAPAM and a tractor parts manufacturer was of the opinion that both the federal and provincial budgets should function in unison to support the industry and the farmer. The federal government is likely to impose GST on tractors, and this should be offset by the provincial governments through reduced markup long-term loans, which should continue for at least five years. He was of the opinion that a one-time heavy subsidy on tractors would put the industry in overdrive for the coming financial year, followed by a sharp drop in orders in the next financial year. This trend has been observed several times in the past 20 years. Sustenance of growth is more beneficial than a boom and bust cycle. Ali also advocated full support to the farmer to improve the agri yield and profitability of the farmers, which will come through low input costs and continuous improvement in irrigation infrastructure and technology, alongwith locally developed agri technology solutions from sowing to harvest and handling and storage of agri products. It is pertinent to mention here that two top tractor plants are situated in Punjab with over 200 SME tractor parts industry mainly operating in the Lahore region, creating jobs for thousands of people. The association has also decided to write to the CM Punjab Maryam Nawaz Sharif with regards to the mode of support to the farmer for the procurement of tractors, with a view to elaborate the role and impact of the tractor parts industry on the national and provincial economy.

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