HYDERABAD: President of Hyderabad Chamber of Small Traders and Small Industry (HCSTSI) Muhammad Farooq Shaikhani said that the Central Bank of Pakistan has announced to increase the interest rate once again to 21%, which is unacceptable and unaffordable for all business community.
He said SBP has raised the policy rate to 21 bps from 9.75 bps from February 2022 to present in the last 14 months which differs from other Asian countries, like Chinese bank offer 3.65%, Indian banks 6.50% and Bangladeshi banks 6%.
The policy rate is already very high compared to other economies in the region; this move will make access to finance more difficult for industry and commerce, which will negatively impact industrialization, private sector growth and factories in the country and it has not only become difficult to run the industries, but it has become almost impossible to promote new industries.
He said Pakistan’s Muslim friendly countries are even not ready to provide funds and the conditions of the IMF are also becoming stricter in agreement. He suggested that Pakistan introduced a tax amnesty scheme in 2018 and earlier, which generated $1 billion or 121 billion rupees in tax revenue from individuals, associations of persons and corporations but such schemes have not fully been embraced which has not yielded substantial results.
Even today, the government of Pakistan needs to introduce such a tax amnesty scheme which will bring undeclared money into the economy, according to an estimate. If this scheme is launched, up to ten billion dollars can be brought in the economical circulation, which will not only stabilize the economy, but also end the bad income and uncertainty in the country.
HCSTSI President further stated that any country whose economic experts have some wisdom, they know that the country’s import burden cannot be reduced without increasing exports, so they give tax exemptions to investors in the country on electricity, gas, and raw materials used in factories and industries so that the industries develop and the country earns revenue through exports, but all these facilities have been taken away from the industries in Pakistan, due to which the jobs of 7 million people working in the industries are at stake and most of the country industries are closing down.
President Chamber Muhammad Farooq Shaikhani concluded his statement by saying that there is a need to highlight the soft image of the country. For this purpose, all stakeholders including businessmen and industrialists should be involved in making economic policy because if Pakistan is stable then we all will be stable.
Copyright Business Recorder, 2023