Need stressed to implement SME Policy in letter and spiritJuly 28, 2015
KARACHI: The Union of Small and Medium Enterprises (UNISAME) on Wednesday asserted that the SMEs have the potential to elevate Pakistan’s position from a lower middle income to upper middle income country, as 99% of enterprises in Pakistan are SMEs. It urged the federal minister for planning, development and reform Prof Ahsan Iqbal to impress upon the government to facilitate the sector.
President UNISAME Zulfikar Thaver has also invited the attention of the participants of the SME Roundtable Conference in Islamabad that the SME sector is the majority sector, the backbone of the economy, the back forte of the large industry, and the vehicle for income generation and employment and deserves priority.
Thaver urged the implementation of the SME Policy in letter and spirit and strengthening of the Small and Medium Enterprises Development Authority (SMEDA) in line with the study conducted by the World Bank report.
The SME Policy is a comprehensive document prepared after consultations with all the stakeholders. The policy recommended and promised SME Export House, Ombudsman, Credit Guarantee, Venture Capital, SME specific bank and institute. The sector and stakeholders fail to understand why it is shelved.
He urged the government to facilitate the sector from grass root level. The farm sector and the primary sector which is the source of raw material is very orthodox and needs to be modernized.
On behalf of himself and the stakeholders, he thanked the MoPD&R for their efforts and vision, and assured full co-operation.
Thaver emphasized the need to allocate land on easy instalments and provide finance at affordable mark up, most importantly access to finance which is missing and for this, he proposed the strengthening of the SME Bank by giving it permission to open branches all over Pakistan and reaching the MSMEs.
He also requested for enhancing the limit for financing the micro and the small and allowing the micro finance banks to finance the micro entrepreneurs and the small up to rupees one million. He reiterated the need for conducive environment, protection to local industry, incentives for innovative and import substitution industries, tax exemptions for new entrants, reduction of import duties on raw and packing material.
He stressed on the need for rapid and jump start of alternate energy units and pleaded for 0% duty and charges on devices.
Thaver urged the MoPD&R to sharpen the Trade Policy to include barter trade, currency swap and discourage smuggling by regularizing border trade.
A diligent approach is needed to overcome the crisis of energy, water, gas and utilities as it is affecting the cost of doing business and making us uncompetitive.
Tax reforms are needed to reduce taxes and widening the tax net. The withholding tax (WHT) system is unfair as it subjects even those who are not obliged to pay taxes by virtue of exemption and instead income tax must be imposed on agriculture. Every entrepreneur is willing to pay income tax as it is on income but WHT is questionable.
UNISAME participants expressed optimism and are looking forward to growth and progress in agriculture, manufacturing, services and trading with particular expectations of enhancing the agro based industries.