ISLAMABAD - Federal Minister for Finance Mohammad Ishaq Dar said the other day that a strong foundation for achieving overall inclusive growth had been laid in the budget 2016-17 through the introduction of robust incentives for all sectors of the economy, including agriculture and industry.

The minister, while reiterating the government's commitment to the uplift of agriculture sector, said it had announced special agriculture package in the last fiscal year, and keeping the tradition alive, it had also announced a number of measures in the 2016-17 budget.

“To top it all, there has been a significant reduction in the prices of fertilizers. Prices of fertilizers have been brought down by Rs250 a bag during the last few months and have now further come down by Rs400 a bag.

Prices of DAP have also dropped by Rs300 a bag with effect from July 2016,” he elaborated.

Dar further said 7 percent duty on pesticides had been withdrawn while off-peak rates of electricity for agricultural tube-wells had been lowered from Rs8.85 a unit to Rs5.35 a unit.

“Furthermore, the agricultural delivery chain, which includes warehousing facilities for the storage of produce, would get tax holidays for three years,” the minister said, and added, “The companies that set up `halal' meat production plants and obtain `halal' certification by Dec 31, 2016, will be exempted from income tax for four years.”

He said that in order to promote farm mechanization and raise productivity,

it had been decided that non-adjustable sales tax at a reduced rate of 7 percent, instead of the existing 17 percent, may be charged on the local supply and import of certain agricultural equipment used in tillage and seed-bed preparation, seeding or planting, irrigation, drainage and agro-chemical application.

“Customs duty, sales tax and withholding tax on the import of agricultural machinery will be reduced to 9 percent from the current 28 percent. Farmers with landholdings up to 12.5 acres will receive interest-free loans for setting up solar tube-wells,” the minister explained.

Dar said the government would actively pursue the objective of economic growth and development under the leadership of Prime Minister Nawaz Sharif with renewed vigour.

He added that making Pakistan Development Fund and Exim Bank of Pakistan operational would be amongst his priorities in the first quarter of 2016-17.

He hoped that these two institutions would help spur infrastructure development and promote exports.

Dar also hinted at the next phase of reforms aimed at improvement in the financial sector.

He said the way people had participated in Eid celebrations throughout the country, and the economic activity that was witnessed, manifested enhanced economic prosperity with marked improvement in the security situation.

The minister stressed that complete focus on the economic uplift of people and country should be the priority as it would pay more dividends in future.