LAHORE: Paapam has welcomed news in the media regarding subsidies to be offered to the farmers for the purchase of tractors alongside other forms of support.

Chairman Paapam Abdur Rehman Aizaz stated that this step of the Maryam Nawaz government in Punjab will boost agri economy of the province and help stimulate national economy which is already showing signs of stability with stable value of the PKR, reduced inflation, and expected reduction in the interest rates.

Mumsahd Ali, SVC Paapam, and a tractor parts manufacturer stated 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.

He 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 farmer, which will come through low input costs and continuous improvement in irrigation infrastructure and technology, along with locally developed agri technology solutions from sowing to harvest and handling and storage of agri products.

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.

Copyright Business Recorder, 2024

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