Proposed mini-budget rejected: Govt urged to slash power rates by 9pc

LAHORE: The Federation of Pakistan Chambers of Commerce and Industry's top officials, Zakki Ejaz and SM Tanveer, urged the government to slash electricity rates by 9 percent and lower interest rates to single digits, citing industry shutdowns and job losses due to expensive power. They also rejected the proposed mini-budget, as Pakistan's trade deficit shrinks and exports surge.

Zakki Ejaz, Vice President and Regional Chairman of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), and SM Tanveer, Chief of United Business Group said the government has increased the FBR target. They believe that without businesses how governments can generate taxes.

S.M Tanveer said the Federal Board of Revenue (FBR) has started filing cases against business individuals. The interest rate has decreased from 22% to 17.5%. The stock exchange has risen by 47 points to 82 points.

The trade deficit has decreased from 27.47 billion to 24.09 billion. Exports have increased from $24.7 billion to $30.6 billion. Agricultural exports have risen from $4.7 billion to $7.1 billion. IT exports have increased from $2.6 billion to $3.2 billion.

Additionally, 18 Independent Power Producers (IPPs) have been served notices and are paying capacity charges of 2.1 trillion rupees. Illegally closed power plants are being paid 1.1 trillion rupees. Saving 1.1 trillion rupees will reduce the cost of electricity units by 10 rupees. It's essential to adopt a "take and pay" policy, where consumers pay for the electricity they use.

"Thanks to the efforts of the Special Investment Facilitation Council (SIFC), five IPPs have been closed. A decision should be made as soon as possible regarding the future of IPPs," Tanveer said.

Inflation has dropped to 6.1%, so why is the interest rate still at 17.5%?

S.M Tanveer demanded a significant decrease in interest rates in November.

The year 2025 is crucial for economic growth. Bank deposits have surged from 22 trillion to 30 trillion rupees, indicating a positive trend.

Reducing interest rates will inject more money into the market. We also urge a swift decision regarding the 18 Independent Power Producers (IPPs) currently under review. Tanveer said by taking these steps, 2025 can truly become a year of economic development and growth.

Copyright Business Recorder, 2024