Uncertain of future, business leaders demand tailor-made short-term policies
KARACHI: Faced with stuck-up export receipts, depreciating currency and higher costs, the business community is quite unsure about the future and calls for tailored-made policies primarily focused at keeping the industrial wheel running.
“We are passing through an economic distress while the future remains unknown. We need a national sustainable strategy to deal with the situation,” President Karachi Chamber of commerce and Industry (KCCI) Agha Shahab said.
Referring to the anomalies in the Finance Bill 2019-20, he said every economic model in the world had failed in this time of pandemic, and the government should form the policies in consultation with the business community, the primary stakeholders of the economic policies.
Agha Shahab also criticized the continuous depreciation in the rupee value saying an economic uncertainty was prevailing, wherein businessmen were reluctant to make deals. “The Federal Board of Revenue (FBR) and State Bank of Pakistan (SBP) should play a proactive role in facilitating the business instead of focusing on government revenue generation.”
Chairman Value Added Textile Sector Exporters Association Javed Bilwani said government needs to formulate short-term policies to suit the prevailing circumstances. “The government needs to prepare budget on quarterly basis on similar pattern as central bank issues monetary policy, until the situation becomes clear”.
“Business community is in severe distress. Export receipts are stuck-up as several international buyers of Pakistan’s goods have filed bankruptcy, while many buyers are not making payments for months,” Bilwani said adding undeterred currency depreciation was quite adverse for the industry and economy as a whole.
Bilwani said depreciated rupee did not give any incentive to the exporters because a significant portion of the exported goods was imported offsetting any benefit. “Moreover, the buyers demand additional discounts when they find about currency depreciation.”
“Many of the industrialists and traders would go out of the business, and the authorities must consider this phenomenon.”
Federation of Pakistan Chambers of Commerce and Industry has called upon the government to control rupee depreciation, as the escalating dollar pushed up cost of deals done by the businessmen with their foreign counterparts.
“Apart from increasing exports and controlling imports the government will have to take administrative measures, as a large demand of cash dollars are seen in the market,” President FPCCI Mian Anjum Nisar said.
“Excessive government borrowing, absence of foreign flows, lack of foreign investment and the huge current account deficit are the vital reasons for constant depreciation of rupee”.
“FPCCI demands of the Finance Ministry to immediately intervene and make some hefty correction in Pakistani Rupee, as the business community of Pakistan is in great frustration on this continuous devaluation of domestic currency,” he said.