Traders Chamber Chief Khawaja Muhammad Shafiq said the present devaluation trend of the Pakistani rupee is creating panic among trade and industry quarters in the country and it must be stopped.
In a statement here Sunday he said that this trend must be arrested immediately otherwise it will be disastrous for the national economy, and asserted that the State Bank of Pakistan is not playing its due role to control the situation.
He said the ramifications of devaluation would negatively impact the industry as well as discourage foreign investment in the country's stock exchange. Petroleum prices will escalate further, while prices of imported edible oil will be increased and overall exports will be affected due to higher cost of production in the wake of increased utility rates, he said.
Devaluation will discourage foreign investment in the industrial sector owing to reduction in profits in dollar terms, he said, adding that the prices of importable manufacturing raw material will also increase, which will also affect our export-oriented industry.
He said that foreign national debt would also increase in rupee terms, while the overall inflationary pressure could even affect the law and order situation, he cautioned. Khawaja suggested that trade deficit must be narrowed in order to arrest the current devaluation, adding that the coalition government should increase the rate of import duty on foreign assembled vehicles, which is the largest single source of current huge trade deficit, he added.
He also advised that more non-traditional goods like pharmaceutical drugs/medicines should be promoted for export, as this segment has not been properly tapped. Compared to India we are far behind in this sector, while our pharmaceutical products are equally good in price, economy and efficacy, he maintained.
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