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August 25, 2019

‘Govt to put off axle load regime on business community’s demand’

Business

August 25, 2019

KARACHI: Government has decided to withdraw restriction on load-carrying capacity of cargo trucks following the apprehension of business community about the new axle load regime, a senior industrialist said on Saturday.

Senior Vice President Federation of Pakistan Chambers of Commerce and Industry (FPCCI) Ikhtiyar Baig said the ministry of communications agreed to the recommendations of business community during a meeting and decided to do away with the new axle load regime.

“The new axle load regime resulted in three-time increase in the cost of transportation as the proposed regime restricted the weighing capacity to one-third of the capacity of the vehicles,” Baig said. “The notification in this regard would come soon.”

The government restricted goods transporters to slash cargo weights on trucks in the budget announced for the current fiscal year of 2019/20. The decision to reduce axle load entails that an industrialist, exporter or importer now has to transit consignments in two trucks instead of one truck.

Business community said it is technically not possible and even if it is done somehow it would raise the consignment’s cost, which would ultimately be borne by the people who are already overburdened with inflation.

Axle load regime would hit the economy as fuel bill is estimated to increase by $5 billion annually and fruits and vegetable exports fear losses of Rs88 billion.

The business community has been criticising the decision to reduce axle load as this would increase the cost and time of transportation.

Junaid Makda, president of Karachi Chamber of Commerce and Industry said the government, which is in dire need of additional revenue, is following the old strategy to further squeeze the existing taxpayers only and is not taking any step to enhance country’s revenue from new sources.

“Additional taxes are being implemented on various sectors without realising whether or not the relevant businesses actually have the capacity to pay such exorbitant taxes,” Makda said.

Tariq Haleem, chairman of Pakistan Ship’s Agents Association said cargoes transported in the country by road transportation weigh around 142 million tons while total cargos moved in the country have weight of around 275 to 300 million tons. He feared shortages of trucks due to new axle load limit.

“Trucks shortages will lead to jobs losses for millions of skilled and unskilled workers in 45 plus industries, including sugar and fertiliser industries and result in a huge cut in consumer spending, which will directly affect the indirect taxation on all the consumer products,” Haleem said in a letter to the Prime Minister Imran Khan.

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