* Smuggling amounts to Rs 500 million each year
* ZTBL officers said to be involved

LAHORE: An estimated 1,500 locally manufactured tractors worth over Rs 500 million are being smuggled to Afghanistan every year through a network of agents, many of who buy off tractors acquired by farmers through special bank loan schemes, industry sources say.

The sources say most of these tractors are sold through the Zarai Taraqiati Bank Limited (ZTBL) and are meant only for local farmers who are prohibited from reselling them unless the bank’s loan is paid off. Tractor manufactures and the bank are responsible for ensuring that the tractor is delivered on complete documentation to the farmer concerned. But sources say agents smuggle the tractors to Afghanistan via Quetta, Parachinar and Chaman, in connivance with border security forces.

These agents have large warehouses in Quetta, where over a thousand tractors are usually in stock, purchased through their extensive network from different cities of Punjab. Moreover, the agents often help the farmers obtain the tractors from the ZTBL and then buy them immediately after the farmers receive delivery. The bank’s scheme therefore, is misused by farmers who use the cash obtained from selling the tractor onward for other purposes and then pay back the loan at a later time.

The sources say some ZTBL officials are also involved in the scheme which allows the tractors to be sold onward. “Some applicants even sell drafts to agents before the delivery of tractors,” one source said.

The bank claims that several precautionary measures are taken but admits that slippage is possible. “As the bank issues thousands of tractors to farmers through its loan scheme, some of them may be misused,” says Javaid Bajwa, a ZTBL regional credit officer based in Lahore. “The bank takes all precautionary measures to make sure that the tractor approved by the bank should reach the right person and be used for the right purpose.”

Mr Bajwa says that the bank ensures documentation is complete and then issues a draft to the application in the name of the tractor manufacturer who then delivers the tractor to the applicant. He says ZTBL mobile credit officers and field officers carry out on-the-spot checking each month to make sure whether the tractor is being used for the purpose obtained. “These officers maintain monthly reports on the tractor and in case of violation by the tractor owner, the bank is authorised to take action against him,” he says.

Reconstruction boom: Sour-ces said the smuggling of tractors to Afghanistan has increased after the fall of the Taliban government. “As part of the rehabilitation process, construction has increased in Afghanistan and the demand for tractors, which are used for loading, carriage and poppy cultivation, has also soared,” a source says. However, some tractors are also sold onwards to Iran.

Massey Ferguson (MF-240) tractors, manufactured by Millat Tractors, are most commonly involved in smuggling since they are considered more economical and safer for loading and carriage. These tractors are sold to farmers at a price of Rs 320,000, exempted from sales tax, and agents buy them from farmers at between Rs 250,000 to Rs 280,000 at the time of delivery, sources said. The agents then sell the tractors in Afghanistan for between Rs 350,000 to Rs 400,000 depending upon the demand and earn around Rs 100,000 per tractor.

Millat Tractors Limited denies any involvement in the smuggling of the Massey Ferguson (MF-240) tractors but does not rule out the possibility. “There is no need for smuggling, as the government allows local manufacturers to export tractors,” said Chaudhry Bashir, Millat Tractors Limited general manager marketing. “But if smuggling of tractors takes place, it is not possible without the involvement of the border security agencies.”

He says the company began exporting to last year and sold 500 tractors to Afghanistan. “This make (MF-240) of the company is preferred in Afghanistan because it is cheaper, safer and its parts are easily available in Kabul and other cities,” he says.

Malik Pervaiz, manager marketing at Allied Motors, another tractor manufacturer also says that while manufacturers are not involved, smuggling is possible through agents and dealers.

Local tractor manufacturers include Raza Facto Tractors, Millat Tractors Limited, Al-Ghazi Tractors Limited which produces Fiat, Allied Motors which produces Shangai and GM Tractors Limited which produces Universal tractors.

According to the Federal Bureau of Statistics, 20,680 tractors were manufactured in 2002-2003, up from 18,708 tractors produced in 2001-2002. The Export Promotion Bureau says 782 tractors were exported in 2002-2003, up from 292 in 2001-2002.

Courtesy Daily Times