The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has suggested that the government must focus on pro-business reforms, business-friendly digital policies and increased inflow of remittances to end the country’s economic woes instead of relying on the short-term remedy of loans from the International Monetary Fund (IMF).
In a statement on Thursday, FPCCI President Irfan Iqbal Sheikh stressed that it was the collective wisdom of the entire business community that the resumption of IMF’s Extended Fund Facility (EFF) could not solve Pakistan’s economic problems as the country would continue to face the risk of default in the foreseeable future.
“Such reforms and remittances can lead to sustainable economic growth and development, but not short-term fixes and IMF loan pre-conditions,” he believed.
Talking to The Express Tribune, Pakistan Businesses Forum (PBF) Vice President Ahmad Jawad remarked that enhanced exports and the recognition of taxpayers’ role were the key to economic development.
“All stakeholders should draw up a charter of economy to address the financial crisis.”
He sought vast investment in the industrial sector to generate revenue for the government, jobs for the youth and profit for businessmen, thus ensuring a win-win situation for all.
The government should prioritise industrialisation and facilitate industrialists with soft loans. Besides, it should give 20% representation to the business community in policymaking bodies at national, provincial and district levels for effective implementation while privatising loss-making public entities, he emphasised.
Sheikh stated that one should be aware of the fact that Eurobonds accounted for only 4% of Pakistan’s external debt as opposed to the much higher ratio for countries that had defaulted.
Therefore, “achieving debt restructuring of all other major external debt after the IMF programme’s resumption will not be difficult for a prudent economist or finance minister,” the statement read.
The only answer to the situation was pro-business reforms, policies and economic agenda, enabling the business community to increase exports, go for import substitution, build foreign exchange reserves, enhance external debt repayment capacity, create jobs and generate tax revenues to fund the country’s development, he believed.
Jawad suggested that the Federal Board of Revenue (FBR) should devise corruption-free and business-friendly digital policies. “It should give 25% quota to exporters and businessmen in national awards and adopt measures to discourage smuggling.”
He proposed that industrialists should be allotted plots in industrial estates on 10-year easy installments, while arbitration centres should be established at the district level to resolve business disputes.
“FPCCI has reached a conclusion that Pakistan needs continuity in economic policies to support the investment climate and all political parties must unanimously agree to a 15-year economic agenda,” Sheikh emphasised.
Furthermore, Pakistan needs $20 billion in the next 18 to 24 months to meet its external liabilities. Even another IMF programme is unlikely to offer that much financing. Therefore, the government should sit with the business community to chalk out a plan to enhance exports and earn foreign exchange in a sustainable and tangible manner, the statement quoted Sheikh as saying.
The PBF vice president called for the implementation of reforms in the agricultural sector. “Farmers owning more than 50 acres of land should pay income tax, but orchards and vegetable farms using modern farming methods should be exempted while concessionary loans should be given for setting up cold storage chains for the preservation of fruits and vegetables,” he stressed.
PBF Vice President Jahanara Wattoo demanded that the information technology and agricultural sectors should be given the status of industry.
She called for the elimination of prize bonds and currency notes of 5,000 denomination as it would help redirect the money to businesses and eradicate corruption.
She called for energy sector reforms and green energy promotion to help solve the energy crisis.
Wattoo urged the government to take the private sector on board to address climate change issues with a defined strategy. “It must register all online stores with mandatory fixed fee of Rs100,000 to support e-commerce with licensing renewal after three years to ensure consumer protection.”
Published in The Express Tribune, March 10th, 2023.
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