The district has a total metalled road-length of 869 Kilometres. The district is  linked with Bhakkar, Jhang, D.G.Khan and Muzaffargarh districts through metalled roads


District Layyah is linked with Bhakkar and Muzaffargarh through railway network


The sub-soil water in tehsil Chaubara is brackish, hence not suitable for industrial purposes. The under ground water at Tehsil Headqarters of Layyah and Karor Lal Esan is sweet and quite suitable for industrial purposes.


There is no important nullah in the district. The river Indus which passes through the Western side of the district and touches the tehsil of Karor Lal Esan and Layyah can be used for this purpose, provided the effluent is pre-treated. However, permission from Irrigation and Power Department, Government of the Punjab is essential.


There are 7 grid stations in the district (ranging in capacity from 66 KV to 132 KV).


There are 18 telephone exchanges operating in the district (ranging in capacity from 50 lines to 2000 lines).


Social infrastructural facilities (Public Sector) available in the district are given in Table – 8 on Tehsil – Wise basis


Middle /
































Foreign investors are permitted to hold 100% of the equity of industrial projects without any permission of the Government. No prior Government sanction is required for establishment of an industry outside Ex-Municipal Territorial Limit of Town Committee / Municipal Corporation irrespective of its cost and size except the following:-
a. Arms & Ammunition.
b. Security Printing Currency & Mint.
c. High Explosives.
d. Radio Active Substances.
e. Alcoholic Beverages or Liquors.
f. Cotton Ginning Industry.
g. Flour Mills.
·        No sugar mill shall be set up in the district.
No industrial unit mentioned in Schedule-A of the notification No. AEA-III-4-1/85, dated 26.10.1986 or industrial unit exceeding total cost of 30 million Rs. shall be set up within 10 miles of international border.
No industry shall be established within the territorial limits of Ex-Municipal Corporation, Municipal Committee and Town Committees without prior approval of the Government.
NOC from Environment Protection Department, Government of Punjab is required.
Tourism has been given the status of industry in accordance with Ministry of Industries & Production Circular No. 1-129/99-INV-IV dated 2nd August 1999.
The Housing and Construction Sector has also been declared as industry (Finance Division Notification No. 10(10)/IF-II/98, dated 07.4.1999 and 4.6.1999.
In accordance with Government notification No. 3(2)/97-INV-IV dated 05.5.1997, Computer Software and Information Technology (IT) have been declared as Industry

4.2              INCENTIVES.

According to the latest investment policy of the Government, major existing tariff and fiscal incentives for manufacturing sector are as follows


Maximum Tariff Rate:



Number of Slabs:

4 (Four)


With Rates of:

5%, 10%, 20%, 30%


Imported Plant & Machinery (Not Manufactured locally):

SRO358(1)/02, dated 05.6.2002.



Machinery (not manufactured locally) imported by engineering units for export related production:

Zero rate export value during proceeding financial year.


Import of certain machines and tools

covered under SRO358(1)/02, dated 05.6.2002:

Duty free


For gems and jewellery manufacturers / exporters:



Machinery (not manufactured locally) imported by Export Oriented Units:

Zero Rated


Raw materials used in production for Export:

Zero Rated


The import tariff on agriculture machinery (not manufactured locally) as per list of specific machinery and equipment for this purpose has been notified vide SRO No. 358(I)/02 dated 15.6.2002:

Zero Rated


Custom duty on import of machinery & equipment used in the field of IT:



Imported duty on computers software and other items related to IT:

Zero Rated



Custom Duties

10% to 25% (except Automobile)


Sales Tax:

15% to 18%


Central Excise Duty:

5% to 90%





Social Security:

7% upto Rs. 3000/- or if salary exceeds Rs. 3000/- Rs. 210/-


Education Cess:

Rs. 100/- per worker


Capital Gain Tax:



Electricity Duty

Rs. 360/- on industrial Rs. 720 on Consumer if bill exceeds Rs. 5000/-


Stamp Duty:

o       Fifty Paisa for every Rs. 100/- or part thereof of the amount of bill of entry.

o       Fifty paisa for every Rs. 100/- or part thereof of the amount of letter of credit.


Normal Tax Rate. 


Corporate Tax Rate

Assessment 2003-2004


 Public Companies:



 Other Companies:



 Banking Companies:


Personal Income Tax Rates. 


Up to Rs. 80,000:

No Tax


Rs. 80,001 to Rs. 150,000:

7.5% of Income


Rs.150,001 to 300,000:

Rs. 6,750 + 12.5% of excess over Rs. 150,000


Rs. 300,001to Rs. 400,000:

Rs. 25,500 + 25% of excess over Rs. 300,000


Rs. 400,001 to Rs. 700,000:

Rs. 40,500 + 30% of excess over Rs. 400,000


Over Rs. 700,000:

Rs. 120,000 + 35% of excess over Rs. 700,000

Depreciation Allowance (Schedule-III)

a) Depreciation Allowance (DA) on Plant & Machinery @ 10% on written down value
b) DA @ 5% is available on office building & 10% on factory building
c) The rate of initial allowance under section 23 shall be 50%.
d) The rate of amortization of pre-commencement expenditure under section 25 shall be 20%.
Initial Depreciation Allowance
Under the provision of sub-section (5) of section 23 of the New Ordinance, Initial Depreciation Allowance at the rate of 5% is permissible on an “eligible depreciable asset” placed into service in Pakistan for the first time in a tax year. For the purpose of such allowance “ eligible depreciable asset” means plant and machinery excluding the following: -
a)         Any road transport vehicle unless the vehicle is plying for hire.
b)                  Any furniture, including fittings.
c)        Any plant or machinery that is acquired second hand.



d)                  Any plant or machinery in relation to which a deduction has been allowed under              another section of this Ordinance for the entire cost of the assets in the tax year               in which the asset is required.
It should be noted that the classes of allowances by way of “First Year Allowance (FYA)”, “Reinvestment Allowance (RA)” and “Industrial Building Allowance (IBA)” as were introduced through the Finance Act, 1998, at varying rate ranging from 20% to 80% have now been withdrawn under the New Ordinance

Fiscal Incentives for Capital Market. 



Capital gains Tax:

Exempted up to June 2004


Tax on Bonus Shares:



Turnover Tax on Trading Stock / Shares:



Tax on Foreign Investment in Government and Corporate Fixed Income Securities:



Individuals, firms and companies, investing in stocks:



Tax on Mutual Funds and Distribution as Dividend:


Transfer of Technology

a) There is no restriction on payment of royalty and / or technical service fees for the manufacturing sector. However, such agreements shall be registered with the State Bank of Pakistan.
The payments of royalties and technical service fees to foreign companies will be taxed at 15%. However, reduced rates under the treaties with different countries remain applicable..
The payment of franchise, royalty or technical fee in case of non-manufacturing sectors is allowed subject to following conditions :--        

-         In case of foreign investment in non-manufacturing sectors including food sector, the initial / lump sump fee should not exceed US$ 100,000 irrespective of number of outlets under one franchise.

-         A maximum 5% of net sales (excluding 15% Sales Tax) in the food sector may be allowed as franchised fee only for these items which are core items of the franchised and are the specialities of the trade name.  The payment of such fees be allowed on monthly basis. No item will be eligible for twice payment of royalty / franchised fee, e.g. soft drinks, etc

-         Percentage / amount of fees etc. for other non-manufacturing projects is also be upto the maximum of 5% of net sales (excluding 15% Sales Tax).

-         Initial period for which such fees may be allowed to projects in non-manufacturing sectors should not exceed five years. Subsequent extension in time period may be considered provided these projects also make investment in alive upstream projects.

          The agreements conforming to above guidelines will be  sent  by the sponsors     to State Bank of Pakistan for its  information. However, any relaxation or  deviation from the   guidelines, will require prior approval of the  CabinetCommittee On Investment



Following Financial Institutions in the country are providing various types of fixed investment industrial financing in the foreign and local currency to the industrial sector for establishment of new industrial units as well as for Expansion, Balancing, Modernization and Replacement (BMR) of existing industrial units within the frame-work of industrial/financial policies of the Government of Pakistan

i)                    Agricultural Development Bank of Pakistan (ADBP).

ii)                   Allied Bank of Pakistan Limited (ABP).

iii)                 Habib Bank Limited (HBL).

iv)                 Industrial Development Bank of Pakistan (IDBP).

v)                  Muslim Commercial Bank (MCB).

vi)                 National Bank of Pakistan (NBP).

vii)               Pakistan Industrial Credit & Investment Corporation (PICIC).

viii)              Pak-Libya Holding Company (PLHC).

ix)                 Pak-Kuwait Investment Company (PKIC).

x)                  Saudi-Pak Industrial & Agricultural Investment Company (SAPICO).

xi)                 Askari Commercial Bank.

xii)               United Bank Limited (UBL).

xiii)              PICIC Commercial Bank.

xiv)             Alflah Bank.

xv)               Union Bank.

xvi)             SME Bank Ltd.

             xvii)    Soneri Bank Ltd

Besides the financial institutions mentioned above a number of Leasing Companies, Modaraba Companies, Private Investment Banks are also providing financing facilities to the industrial sector. Punjab Small Industries Corporation has launched a Soft Loan Credit Scheme to provide credit to Small Industrial Sector. The main priority sectors will be as under:-

·        Service Industries

·        Agro / Agro Support Industries

·        Food Processing Industries

·        Export Oriented Industries

·        Import Substitution Industries

·        Information Technology (IT) Projects

·        Handi Crafts Industry                        

·        Women Enterprises



The maximum loan limit will be up to three (3) million with debt equity ratio 60 : 40 for new units and 50 : 50 for existing projects. The mark up ratio will be 8% for new projects, 9% for BMR/Expansion and 12% for working capital loans. The repayment period will be 6 years for new projects, 5 years for BMR/Expansion and one year for working capital including grace period as detailed below


New Projects:

One year / 1½ year from the date of disbursement of last instalment / first instalment which ever is earlier.



Six months / one year from the date of disbursement of last instalment / first instalment which ever is earlier.


Working Capital: Two months from the date of disbursement.


In order to promote the traditional crafts in Punjab the PSIC is also launching a Soft Loan Scheme to provide loan upto Rs. 40,000/- at the mark up rate of 7% per annum with repayment period of two years including a grace period of 4 months to individuals / units with fixed investment upto Rs. 2 lac. 50% beneficiaries would be the women.Other details if any, could be ascertained from the Regional / Local Offices or the Headquarters Office of Punjab Small Industries Corporation, Egerton Road, Lahore.Small & Medium Enterprise Development Authority (SMEDA) has also been established to develop small and medium enterprises in Pakistan through aggressive sector development programs, formulation of policy guidelines for the Government and facilitate the small & medium enterprises by providing a variety of support services




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