ISLAMABAD (May 28 2003) : The Budget 2003-04 would phase out all the deletion programmes in line with WTO requirements, except for the auto industry for which the government is expected to move the world body for extension in time, it is learnt.
A meeting of the Board of Management of the Engineering Development Board of Tuesday decided to phase out various industries where the government had given tariff concessions to protect the local industry.
These items have been taken out of the concessionary SROs and now will be brought under the custom tariff code.
Sources told Business Recorder that the tariff likely to be announced in the Budget would be a lower rate.
The present four slabs of tariff are 25 percent, 20 percent, 10 percent and five percent duty.
In the case of most items for the industries being phased out from deletion programme, the rate of duty is proposed to be reduced.
The raw materials are likely to be subject to five percent rate of duty, sub-components and components at 10 percent and finished products between 20 and 25 percent.
An official source told Business Recorder that the engineering industry would now have to face the challenges of WTO on its own and compete in the international market.
Under commitment with the WTO, the Budget for next year would specify over a 100 items relating to the deletion programme of the concerned industries.
These include electrical goods industry, like bulbs, fans, refrigerators, air conditioners, TV, cement and sugar plants, home appliances, agriculture machinery, etc.
The meeting presided over by Dr Akram Shaikh; Secretary Ministry of Industries and Chairman of EDB appreciated the sizeable rise in production of 21 large-scale manufacturing items. The increase is in double digits.
Giving increase in production of Steel Mill, its Chairman said that Mill's production rose from 7000 tonnes in 2000 to 20,000 tonnes in 2001 and to 35,000 tonnes in 2002.
Some other highlights of industrial growth during July-March period are: Auto parts production rose by 50 percent and employment doubled during the last two years; production of domestic appliances increased by 20 percent; production of split- type air-conditioners rose by over 50 percent; the automobile production rose by 35 percent; motorbikes by 15 percent; and tractors and plastic auto parts by ten percent.
Besides, the meeting was told that the vendors industry has made new investment of Rs four billion during the last one year creating nearly one lakh additional jobs.
It is stated that nearly two hundred vendors have invested, on average, Rs 15 million to Rs 20 million as the local demand had increased and the units were working to their capacity and that additional investment went to BMR.
Here are the details of the large scale manufacturing items during July – April for the past two years:
=============================================================== LARGE SCALE MANUFACTURING ITEMS SHOWING DOUBLE DIGIT GROWTH =============================================================== PRODUCT UOM 2001-2002 2003-2003 %AGE (Jul-Apr) (Jul-Apr) Change =============================================================== 1 CEMENT Th. Tons 8,025 9,547 19 2 SUGUR Tons 3,224,050 3,662,625 14 3 SODA ASH Tons 209,049 236,841 13 4 COTTON CLOTH Th. M 4,068,190 4,541,745 12 5 MOTOR TYRES/TUBES Th. Nos. 1,182 1,389 18 6 BICYCLES No. 445,794 518,247 16 HOME APLIANCES 7 DEEP-FREEZERS Nos. 79,100 96,000 21 8 REFRIGERATORS 221,450 296,000 34 9 TV SETS 370,000 621,000 68 STEEL PRODUCTS 10 H.R. SHEETS/STRIPS 318,965 234,733 36 11 C.R. COILSI/SHEETS 100,833 125,303 24 AUTOMOBILES 12 CARS Nos. 32,168 49,285 53 13 MOTORCYCLES 106,891 140,203 31 14 LCVs 6,315 9,929 57 15 BUSES 855 1,186 39 16 TRUCKS 793 1,608 103 17 TRACTORS 18,708 20,680 11 PAPER & PAPER BOARD 18 PAPER PRINTING Tons 15,876 21,883 38 19 PAPER PACKING 25,843 30,126 17 20 PAPER BOARD 133,441 170,025 27 JUTE GOODS 21 SACKING Tons 41,188 49,506 20 ===============================================================
The meeting was told that the ceramic industry was at take-off stage because Wapda was embarking on village electrification programme and ceramic conductors were in great demand.
Sources however admitted that despite the increase in production and various incentives given to the industry, the complaint of high cost of products was not incorrect.
This was largely due to the high utility rates of electricity, gas and water. It was also admitted that over a score of agencies were supervising the working of the industries.
The inspectors and supervisors, according to a recent report of the World Bank, extorted money or created unnecessary hassle for the industries.
In common parlance of the industries, the inspectors are called “bribe taking vultures”.