Piqued by the rupee slide, KCCI chief underscores need for fixing economy

KARACHI: President Karachi Chamber of Commerce & Industry (KCCI), Muhammad Idrees while highlighting the impact of unstoppable devaluation of Pakistani rupee against dollar and high inflation, said that unsettled economic issues would severely jeopardize Pakistan’s future and the top brass must get the national priorities in order and fix the ailing economy in a more sustainable manner.

President KCCI pointed out that since January 2022, Pakistani rupee has lost around 35 percent of its value against USD which stood at Rs 178.50 on January 1, and was currently at around Rs 240, depicting a very dreary picture of the economy and having a devastating impact on the industrial performance because of high cost of doing business and the inflation.

“The miseries and hardships aggravated further for the industry as well as the public when they, in addition to somehow digesting the impact of rising dollar and subsequent inflation, have to pay the record high electricity bills which are totally unaffordable for the public and the industries”, he said, adding that this has led to closure of a large number of Small & Medium Enterprises (SMEs) and raised unemployment.

He noted that in August 2022, Pakistan witnessed a year-on-year CPI inflation of 27.3 percent which was too high whereas in the first two months of current fiscal year, i.e., July and August, exports stood at $ 4.7 billion only against the imports of $ 11.06 billion.

“However, the revenue collection witnessed a surge despite a drop in imports but it simply cannot be considered as an achievement as it happened purely because of steep devaluation of Pakistani rupee”, Muhammad Idrees said and informed that collection of Customs duty recorded an increase of 3 percent or Rs 2 billion despite a decline of 10 percent in imports in July 2022 as compared to July 2021.

He further mentioned that the impact of ban on luxury, non-essential, machinery (HS 84 & 85) and raw materials was clearly visible in the imports of July 2022 when a downfall of 37 percent was recorded on a month-on-month basis and on a year-on-year basis, the imports fell by 10 percent.

Copyright Business Recorder, 2022