EDB BUDGET PROPOSAL
CALL FOR SLASHING DUTIES ON IMPORT OF INDUSTRIAL RAW MATERIALS
Apr 21 - 27, 2008
LAHORE: Engineering Development Board (EDB) has recommended the import of raw materials for most of the industrial goods at lower duties in order to maintain the prices of finished goods at an affordable level.
This recommendation was made by the EDB as a part of its budget proposals for the year 2008-09. The EDB, which received the proposals and recommendations from stakeholders, would pass on the same to the Federal Board of Revenue (FBR) for incorporation in the budget for the year 2008-09.
The exercise titled Competitiveness and Efficiency Improvement (Budget 2008-09) was launched to provide the industry with necessary launching pad to be more competitive through tariff rationalisation. It was started in February with formation of 20 sectoral committees.
Sources in the EDB told PAGE that certain industries ignore their production efficiencies, unattended wastage both material and energy affect their cost of production, hence making them uncompetitive. While providing sufficient tariff incentives through cascading to the local industry and foreign investors, the emphasis remained on making the industry more competitive through facilitation rather than providing undue protection.
The sources said it is important that the cost of duties and taxes need to be weighted against these inefficiencies and the industry needs to shift emphasis to high value added goods in order to reduce the import cost for industry through proposing lower tariff on such material.
The EDB received proposals from manufacturers of electrical capital goods, home appliances, heavy engineering goods, machine tools, lifting equipment, light engineering goods, pharmaceutical, food processing, packaging and printing machinery, renewable energy equipment, cutlery and surgical goods sector, wires and cable, electronic industry, paper and paper board products, chemical, plastic and other based products and automobile sectors.
According to sources, a committee of the EDB examined existing duty structure, available under various SROs on the import of raw materials, sub-components, components, assemblies, sub-assemblies, plant, machinery and equipment not manufactured locally in the wake of elimination of TRIMS. It also reviewed execution of SAFTA and other Preferential Free Trade Agreements (PTAS/FTAS) and status of local industry. The loopholes in SROs were detected to discourage their unfair use. It noted discrepancies, anomalies and problems faced by the industry during the implementation of SROs.
The Engineering Industry needs to keep the cost of inputs low in order to address the problem of increasing prices so that the interests of the consumers could be protected.