Karachi, being Pakistan’s premier industrial and financial centre and home to 90 percent of the multinational corporations operating in Pakistan, and also with the largest formal economy of the country - estimated to be worth over $200 billion, collecting, 35 percent of Pakistan’s tax revenue, and generating approximately 25 percent of Pakistan’s entire GDP and approximately 30 percent of Pakistani industrial output — sometime draws the attention of the decision-makers from Islamabad.
This time it was the visit of the Prime Minister Shehbaz Sharif who interacted with the members of the business community during an hour-long meeting at the Sindh Chief Minister’s House. The pattern of the visit and meetings/proceedings is remarkably consistent—a meeting between the dignitary and a same set of business community’s representatives who vocally present a list of issues faced by trade and industry in order to attract assurances of redressal from the government leadership and functionaries.
Judging from the fact that the same list of issues is repeated time and again over the last two years, one can state that matters are not moving beyond lip service and it is more of a status quo. This is understandable as the government’s capacity to bring about a change or improvement is extremely limited and checkmated by factors beyond its control.
PM Shehbaz, who had arrived in the port city a couple of days ago on his maiden visit after his election in February, said the meeting was an attempt to listen to the “brilliant minds of business, absorb what they say and put it into action” for a comprehensive economic growth roadmap.
“You all are great minds of business… Today we need you to take a step forward and bring this rental business to an end. Let’s focus on genuine industrial and agricultural growth and double the exports in the next five years. It’s difficult but not impossible. It’s an article of faith for me. I would listen to you and make a plan to put that into action.”
As Prime Minister Shehbaz Sharif sat down with the business community to find ways to uplift the economy through exports, his resolve was met with apprehensions from industry leaders who said it was “almost impossible” to do business under the current circumstances, particularly with high energy costs, high lending rates, escalating cost of doing business, inconsistent government policies and above all political instability in the country.
“The prime minister is keen to support the industry by doubling exports and reducing business costs but it seems impossible in the current situation,” said a point of presentation shared by the Karachi Chamber of Commerce and Industry (KCCI).
The business leaders emphatically presented five points for the attention of the Prime Minister:
Forge trade ties with India
Reconcile with Imran Khan for much-needed political stability to “turn around” the economy.
Concerns over ‘cross-subsidies’.
A call for fair energy tariffs
Warning that the rising costs could help competitors take over Pakistan’s export orders
On all the above points, the Prime Minister can at best be a catalyst but has limited influence to bring around a change.
The prospects of trade with India are largely dependent on concessions by India on Kashmir to enable Pakistan to sell the idea to its people. With BJP expected to achieve yet another landslide victory in the forthcoming election, any respectable concession from India on Kashmir is unlikely.
The foreseen 25th agreement with the IMF (International Monetary Fund) will be more demanding and concessions on subsidies and utility tariffs are unlikely to happen. Exports shall remain challenging.
The most probable thing which could be achieved is to create political stability in the country - which is home-grown and self-inflicted. But, over time, it has spun out of control with no end in sight. The consequences of the present political stalemate and wilderness are devastating for the nation and its people.
Political instability is holding the economy of the country, its sovereignty, its people, notably, the poor segments of the country and the aspirations of country’s future generation, hostage. Much too much is at stake.
There was a sense of concern among the business leaders over the political instability in the country for which they urged the PM to take initiative as the head of the government. “You have made a few handshakes after taking the charge that has produced good results and progress on the IMF deal is one of them,” said Arif Habib, the chief of Arif Habib Group – a capital market giant.
“I suggest you do a few more handshakes. One of them is regarding trade with India, which would greatly benefit our economy. Secondly, you should also [patch up] with an inmate of Adiala Jail (a reference to jailed PTI leader Imran Khan). Try to fix things at that level as well and I believe that you can do it.”
Reportedly, the PM avoided responding directly to the questions aimed at achieving political stability, but claimed to have noted down proposals for economic growth and assured them that he would soon invite businessmen from all across the country to Islamabad and sit with them “till all the issues aren’t resolved”.
The issues are well defined and well known but their solutions are not. It is the solutions which need to be defined and honestly worked upon in times when business is not ‘business as usual’, so to speak.
Copyright Business Recorder, 2024
The writer is a former President, Overseas Investors Chamber of Commerce and Industry
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