KARACHI: Leading industrialists and members of the business community in Pakistan told the de facto commerce minister on Saturday that doing business in Pakistan had become increasingly difficult, at a meeting held at the Karachi Chamber of Commerce and Industry (KCCI).
Last year, a struggling Pakistan finalized a $6 billion bailout package from the International Monetary Fund (IMF) to stabilize its economy marred by a balance of payments crisis and fiscal issues.
As a result of strict IMF loan conditions, the country is now facing a slowing growth rate, which decelerated to 3.3 percent in FY19 against 5.8 percent growth in FY18.
“When existing industries are confronted with severe gas crises, high electricity rates, exorbitant interest rates, devaluing rupee against the dollar, rising petroleum prices, lack of infrastructure and other serious civic issues, doing business has become extremely difficult,” said Agha Shahab Ahmed Khan, KCCI President.
“How could anyone think of setting up industries or go for expansion in such a situation,” he said and added that the government’s imposition of additional customs duties to deal with its rising trade deficit, had adversely affected industrialization.
“In order to actually make 2020 a year of growth, the government will have to resolve all these issues on top priority. Otherwise, there will be no growth at all,” he warned.
Though Pakistan’s global ranking for ease of doing business improved by 28 notches to 108 last year, the country’s industrialists say the ranking has not translated into the country’s exports and growth.
Additionally, in its latest report, “2020 Global Economic Prospects,” the World Bank has projected Pakistan’s growth rate in the current year at 2.4 percent, 0.3 percent lower than its estimates of June 2019.
Abdul Razak Dawood, the de facto commerce minister, said Pakistan’s economy was on the road to recovery and stabilizing.
“You know what the condition of the economy was 18 months back... the country was losing $2 billion every month,” Dawood said. “That position has changed today. Our external position is stable... we even posted a current account surplus.”
Dawood, an adviser to the PM for commerce, said that in a first, his ministry has made tariff-setting part of industrial policy instead of revenue policy. He added that under-invoicing was a major issue in the country and said it was currently losing the country $4 billion.
On Saturday, the Chairman of Pakistan’s Federal Board of Revenue, Syed Shabbir Zaidi announced in a Twitter post that Prime Minister Imran Khan would be presiding over a meeting of Pakistan’s traders on Jan. 20 at the Prime Minister’s House in Islamabad.
“The PM will formally announce the concessions given to traders community and will seek the assistance of trade bodies incomplete documentation and tax contribution by trading sector,” Zaidi said in a separate tweet.
