FPCCI body chief's reaction: Federal budget offers no special incentives to SMEs

Federal budget 2018-19 has not offered special incentives to small & medium industries in the country, which are struggling hard to survive in the face of high cost of production, representatives of small and medium industries stated on Friday.
Small & medium industrial sector is the backbone of the economy and a big contributor in the export earnings. It should have been given relief in taxation, but unfortunately it was left out in the priorities of the federal government when it presented its budget for the next financial year, representatives stated when Business Recorder approached them to solicit their views on federal budget 2018-19.
Commenting on the budget, Chairman Standing Committee Federation of Pakistan Chambers of Commerce & Industry (FPCCI) on Small & Medium Enterprises (SMEs) Rahmatullah Javed stated that budget was more a political budget than a real growth-oriented budget to support the industry especially SMEs.
He said that SMEs are the backbone of industrial sector in the country having 45 percent share in production and 40 percent in exports but have nothing to gain from federal budget, which didn't offer any special package to boost its production.
Rahmat said that SMEs sector has been waiting Rs 4 billions rebate from government for the last many years but government has been making false promises to fulfil its commitments.
He also termed the budget disappointing as far as cluster-based development is concerned which is established growth phenomenon of SMEs around the globe. Government should have announced some incentives to promote cluster-based development of SMEs.
He also deplored the fact that proposals for development of SMEs sector were not incorporated in the federal budget and apparently thrown in the dustbin despite the throughout and in-depth working of the industry to formulate these proposals.
He also pointed out that double taxation on SMEs is causing hardships for the sector to flourish and said that this double taxation is particularly hitting Punjab SMEs hard.
Javed Bilwani, Chairman Pakistan Apparel Forum - umbrella organization of export-oriented small & medium industries also termed the budget short of expectations especially of the export sector. As small & medium industries make a large part of export-oriented sector, there should have been special incentives for this sector.
Bilwani believed that growing trade deficit is touching dangerous levels and it could have been controlled only through incentives to export sector to register remarkable growth in its earnings. SMEs being a major contributor in the export earnings would have been performing better if federal government would have incorporated the proposals regarding development of SMEs.