Govt ignored agri sector in upcoming budget: SAB
The Sindh Abadgar Board (SAB) has deplored that the government appears indifferent to budgetary suggestions of their cohort as no consultative process has got underway with only few days left in the budget presentation.
A meeting of the board, a group which lobbies for the rights of farmers, was held in Hyderabad on Thursday with Mahmood Nawaz Shah in the chair. The meeting underlined that the prevailing slump in agricultural economy, on the contrary, called for painstaking pre-budget deliberations among the stakeholders.
The growers found fault with what they described as the government's 'cherry-pick' policy with regard to their sector's deregulation which, they claimed, is now being manipulated by the traders to the detriment of their corps. They contended that the actual deregulation of the agro-economy also encompassed free export of the agricultural produce, which to the utter disadvantage of the agriculturists, is being retrained.
"[Besides] the export will only enhance when the agricultural industry is competitive. One of the aspects of competitiveness is to analyze the international prices which are backed by heavy subsidies in input costs like in India," they said. They pointed out that they will become competitive with foreign growers when a robust infrastructure is provided to the rural economy.
"The anomaly of 18% GST [General Sales Tax] on locally produced cotton and the duty free import of cotton ought to be removed." The meeting also demanded withdrawal of the GST from imported and locally made machinery, implements and tractors.
The measures like arranging subsidised credit, grants, equity participation and public private partnership have also become essential to support the sector with which the livelihood of tens of millions of people is connected.
They gave reference of India, which has converted 22% of their area to high efficiency systems whereas Pakistan has not achieved even 0.5% target.
Livestock
The SAB has discredited the official figure of the livestock sector's over 4% growth in the ongoing fiscal. The Federal Planning Commission's working paper for the upcoming federal budget speaks about 4.7% expansion in the sector over the previous year.
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Express Tribune
a day ago
- Express Tribune
Govt ignored agri sector in upcoming budget: SAB
The Sindh Abadgar Board (SAB) has deplored that the government appears indifferent to budgetary suggestions of their cohort as no consultative process has got underway with only few days left in the budget presentation. A meeting of the board, a group which lobbies for the rights of farmers, was held in Hyderabad on Thursday with Mahmood Nawaz Shah in the chair. The meeting underlined that the prevailing slump in agricultural economy, on the contrary, called for painstaking pre-budget deliberations among the stakeholders. The growers found fault with what they described as the government's 'cherry-pick' policy with regard to their sector's deregulation which, they claimed, is now being manipulated by the traders to the detriment of their corps. They contended that the actual deregulation of the agro-economy also encompassed free export of the agricultural produce, which to the utter disadvantage of the agriculturists, is being retrained. "[Besides] the export will only enhance when the agricultural industry is competitive. One of the aspects of competitiveness is to analyze the international prices which are backed by heavy subsidies in input costs like in India," they said. They pointed out that they will become competitive with foreign growers when a robust infrastructure is provided to the rural economy. "The anomaly of 18% GST [General Sales Tax] on locally produced cotton and the duty free import of cotton ought to be removed." The meeting also demanded withdrawal of the GST from imported and locally made machinery, implements and tractors. The measures like arranging subsidised credit, grants, equity participation and public private partnership have also become essential to support the sector with which the livelihood of tens of millions of people is connected. They gave reference of India, which has converted 22% of their area to high efficiency systems whereas Pakistan has not achieved even 0.5% target. Livestock The SAB has discredited the official figure of the livestock sector's over 4% growth in the ongoing fiscal. The Federal Planning Commission's working paper for the upcoming federal budget speaks about 4.7% expansion in the sector over the previous year.
Business Recorder
2 days ago
- Business Recorder
PBF urges govt to exempt local cotton, seed, yarn, fabrics from 18pc GST
LAHORE: The Pakistan Business Forum (PBF) has called on the federal government to exempt local Cotton, yarn, Fabrics, Oil cake, seed cotton and oil from the 18% General Sales Tax (GST) in the upcoming Federal Budget 2025–26, warning that the failure to do so could push the country's Agriculture and textile industry toward total collapse. PBF Chairman South Punjab, Malik Talat Suhail while talking to media emphasized that the Export Finance Scheme (EFS), introduced to phase out subsidies and promote exports, has instead proven detrimental to the textile sector. Under EFS, imported raw materials are exempted from both sales tax and customs duty, while local inputs continue to be taxed at 18%. Though this tax is technically refundable, in practice, only 60–70% of refunds are released. The refund process is plagued by delays, manual processing, and high costs—issues that disproportionately harm small and medium-sized enterprises (SMEs). This imbalance has led many exporters to favour imported inputs, causing serious damage to local suppliers. As a result, Pakistan's import of cotton, yarn, and fabric surged by $1.5 billion in FY 2025, climbing from $2.19 billion to $3.64 billion. In contrast, textile exports rose by only $1.4 billion and net textile exports are projected to decline from $14.0 billion to $13.6 billion. Over 120 spinning mills and more than 800 ginning factories have shut down, while protests from loom workers in Faisalabad are growing. SMEs are particularly vulnerable, as they face multiple tax payments at every stage of production and have limited access to cheaper imported alternatives, unlike larger firms. The current situation has placed severe pressure on the country's foreign exchange reserves, especially as the number of commercial import licenses has tripled from 800 to 2,400. Meanwhile, local cotton production has fallen to a historic low of just 5 million bales, with further declines anticipated. Due to a lack of government support and declining demand, many farmers are abandoning cotton cultivation in favour of more water-intensive crops, placing further stress on national water resources. PBF also warned that the collapse of the cotton economy is stripping rural areas of $2-3 billion in income, with women cotton-pickers among the hardest hit. 'Pakistan is currently the only country imposing an 18% sales tax on cottonseed and cotton feed, driving farmer income below the cost of production and hitting the poorest segments of society the hardest'. Rising unemployment and declining rural earnings are further exacerbating the economic crisis. PBF South Punjab Chief has urged the government to immediately delist cotton, yarn, and fabric from the current EFS policy. He further stated that maintaining GST on local cotton while exempting imports under EFS is effectively a 'Pakistan-unfriendly policy'. It undermines local production, weakens the economy, and benefits only opportunistic importers. Without urgent reforms, the country risks facing a deepening economic crisis driven by misguided policy decisions. Copyright Business Recorder, 2025
Business Recorder
2 days ago
- Business Recorder
PBF seeks 18pc GST exemption on yarn, fabric
KARACHI: The Pakistan Business Forum (PBF) has called on the federal government to exempt yarn and fabric from the 18% General Sales Tax (GST) in the coming Federal Budget 2025–26, warning that the failure to do so could push the country's textile industry toward total collapse. PBF Chairman South Punjab, Malik Talat Suhail emphasised that the Export Finance Scheme (EFS), introduced to phase out subsidies and promote exports, has instead proven detrimental to the textile sector. Under EFS, imported raw materials are exempted from both sales tax and customs duty, while local inputs continue to be taxed at 18%. Though this tax is technically refundable, in practice, only 60–70% of refunds are released. The refund process is plagued by delays, manual processing, and high costs—issues that disproportionately harm small and medium-sized enterprises (SMEs). This imbalance has led many exporters to favor imported inputs, causing serious damage to local suppliers. As a result, Pakistan's import of cotton, yarn, and greige fabric surged by $1.5 billion in FY 2025, climbing from $2.19 billion to $3.64 billion. In contrast, textile exports rose by only $1.4 billion, and net textile exports are projected to decline from $14.0 billion to $13.6 billion. Over 120 spinning mills and more than 800 ginning factories have shut down, while protests from loom workers in Faisalabad are growing. SMEs are particularly vulnerable, as they face multiple tax payments at every stage of production and have limited access to cheaper imported alternatives, unlike larger firms. The current situation has placed severe pressure on the country's foreign exchange reserves, especially as the number of commercial import licenses has tripled—from 800 to 2,400. Meanwhile, local cotton production has fallen to a historic low of just 5 million bales, with further declines anticipated. Due to a lack of government support and declining demand, many farmers are abandoning cotton cultivation in favor of more water-intensive crops, placing further stress on national water resources. The PBF also warned that the collapse of the cotton economy is stripping rural areas of $2–3 billion in income, with women cotton-pickers among the hardest hit. 'Pakistan is currently the only country imposing an 18% sales tax on cottonseed and cotton feed, driving farmer income below the cost of production and hitting the poorest segments of society the hardest.' Rising unemployment and declining rural earnings are further exacerbating the economic crisis. The Forum stressed that if current policies are not revised, Pakistan could lose $4–6 billion in potential foreign exchange earnings. Instead, the country continues to rely on expensive foreign loans to cover rising import costs, worsening the trade deficit, unemployment, and tax collection shortfalls. International partners have also taken notice. The United States has signaled that, unless Pakistan addresses its trade imbalance, it may impose a 29% tariff on all Pakistani exports. Though the US has offered to export up to 1.5 million bales of cotton and has invited a Pakistani trade delegation for discussions, the crumbling of local spinning capacity raises the critical question: who will consume the cotton if domestic mills shut down? The PBF South Punjab chief has urged the government to immediately delist cotton, yarn, and fabric from the current EFS policy. He further stated that maintaining GST on local cotton while exempting imports under the EFS is effectively a 'Pakistan-unfriendly policy'. It undermined local production, weakens the economy, and benefits only opportunistic importers. Without urgent reforms, the country risks facing a deepening economic crisis driven by misguided policy decisions. Copyright Business Recorder, 2025
