Pakistan’s tractor industry flourishing

Pakistan’s tractor industry recorded booming production and sales in February 2012 while heavy vehicle segment continued to face laggard sales. Pick-ups, two-and three-wheeler sales also posted positive growth. Al Ghazi (Fiat) produced and sold 2,121 and 3,571 units in February as compared to 4 and 204 units in January respectively. However, the overall sales of Fiat tractors in July-February 2011-2012 fell to 7,436 units as compared to 18,005 units. According to figures released by Pakistan Automotive Manufacturers Association (PAMA), Millat Tractor (Massey Ferguson) produced and sold 3,606 and 5,335 units in February as compared to 1,453 and 165 units in January. Sales in July-February 2011-2012 dropped to 14,505 units as compared to 27,514 units in the same period of last fiscal year. Farmers/growers resumed their tractor buying activity after reduction in general sales tax (GST) on farm machinery to five from 16 per cent coupled with decision to resume loaning facility by Zari Taraqiati Bank. The tractor industry suffered the most difficult period from July 2011 to January 2012 in terms of sharp decline in sales and production as growers/farmers became reluctant to lift tractors after the imposition of 16 per cent GST in April 2011. The government finally reduced the GST to five per cent on January 20, 2012 and later issued an SRO which also helped in clearing of thousands of unsold tractors parked at the factories and countrywide dealership networks. General Manager Sales and Marketing Balochistan Wheels Limited Shaikh Mohammad Iqbal told that Millat Tractors had planned to produce 5,000 tractors each in March, April and May followed by 3,000 tractors each by Al Ghazi in the next two months.