ISLAMABAD: Internationally, commodity prices have plummeted over the last couple of years and no one has borne the brunt of global glut more than the agriculture sector.
However, agriculture has been jealously guarded in Pakistan to win over farmers for elections. In a bid to further protect them, the agriculture ministry has made certain recommendations to the Finance Division.
If acted upon, these recommendations can drastically increase prices of everyday commodities like poultry (chicken) and milk and even strain the foreign exchange reserves. Last month’s (CPI) inflation has already come out to be the highest in 16 months and this might break the back of the already hard-hit consumers.
The Ministry of National Food Security and Research has asked the Finance Division to enhance duties on certain agro-products to protect the local industry in addition to relaxing duties on many agro-inputs including import of tractors.
The ministry recommended increasing regulatory duty on the import of chicken meat, both processed and unprocessed, from 25% to 100%, so that the local industry could be protected. TMoreover, it has also been recommended that the duty on the import of broiler chicken may be increased from 5% to 50%. Furthermore, the ministry also recommended an increase in the regulatory duty on the import of dry milk from the existing 20% to 50% so that the local industry could be strengthened.
An official in the ministry told The Express Tribune that the Finance Division had agreed to reduce duty on the import of agro-inputs from 9% to 7% in the coming budget, which has already been slashed from 43% to 9% in the last budget.
Additionally, the ministry recommended that duty on the import of tractors be decreased from the existing 34% to as low as possible. Duty on the import of fish and shrimp feed has also been recommended to be entirely eliminated from the existing 20% along with a 20% regulatory duty on the import of testing kits for evaluating water quality.
The ministry has also recommended retaining the SRO issued in 2006 under which the regulatory duty on the import of pesticides has been reduced from 10% to 5%.
Source: The Express Tribune