Karachi, November 28, 2014 (PPI-OT): The Union of Small and Medium Enterprises (UNISAME) urged the government to remain proactive and promote the primary sector scientifically which is the backbone of the country.
President UNISAME Zulfikar Thaver speaking as guest at a local television business channel invited the attention of the government to the much needed agricultural reforms to increase yield per acre and also for research.
The programme was basically organized for the rice sector which is in turmoil due to decline in prices of basmati and non basmati rice. There is a reduction of about 40% in basmati paddy and about 12% in non basmati rice.
Thaver suggested long term and short term measures for overcoming the situation. He suggested relief to the primary sector for farm inputs and urged the ministry of agriculture to make silos and warehouses facility for rice aging. He stressed on reduction of duties on fertilizers, seeds, fumigation farm equipments. It is very important to increase the yield per acre to reduce the cost of production.
The UNISAME president called upon the Trade Development Authority of Pakistan (TDAP) to promote branding, arrange delegations to Europe, USA and Canada for promotion of basmati rice. Secondly he pinpointed the need for basmati festivals and exhibitions for the promotion of rice brands. It is very important to promote our parboiled rice in global markets.
Iran is expected to reopen import of rice at the end of the year and Pakistan needs to conclude currency swap with Iran to be able to ship to Iran. He appreciated the relief to SME farmers of Rs 5000 per acre given by prime minister Mian Nawaz Sharif but as representative of SME farmers he stated that it is too little.
The government could impose agricultural income tax as it would be on income but should exempt duties and taxes on farm inputs. The SME farmers are demanding fixing of support price but narrating the 2008 experience where the government purchased the crop to save the farmers but resulted in huge losses as the purchased rice was found inferior and could not be sold, even today there are stocks of unsold rice and this proved to be a big loss to the government.
This mistake should not be repeated he said and instead the government can give direct subsidy to the farmers without the purchasing agency intervening as it leads to corruption. Pakistan grows about 6.5 million tons of basmati and non basmati rice out which 4 million tons is non basmati and about 2.5 million tons is basmati.
During the period July 2013 to June 2014 Pakistan exported 733860 metric tons of basmati rice and 2627899 metric tons of non basmati rice. Rice is one of the major export earning commodities next to cotton and textiles. The rice exports bring in about US dollars 2 billions in foreign exchange and by virtue of this deserves the best attention of the government.
The earnings could be doubled if the sector is promoted and facilitated. The government should exempt the sector from with holding tax as it is incurring losses at present due to closure of units. The basmati parboiling units are closed in Sindh and huge investments are blocked.
Thaver urged the Small and Medium Enterprises Development Authority (SMEDA) to upgrade the parboiling units to enable them make steamed rice which is in demand. Thaver highlighted the fact that the government must facilitate the farmers and the exporters as well because both play important roles
He appreciated the role of the Rice Exporters Association of Pakistan (REAP) and said the chairman Rafique Suleman and senior vice chairman Mohsin Aziz are both dedicated and working to increase exports.
For more information, contact:
Union of Small and Medium Enterprises (UNISAME)
75/1 3rd Commercial Street,
Phase IV, D.H.A., Karachi, Pakistan
Cell: +92-300-8245307, +92-321-8245307