BMP for encompassing long-term vision for sustained progress

The Federation of Pakistan Chambers of Commerce and Industry’s Businessmen Panel (BMP) has asked the government that its strategies should not only focus on short-term gains but also encompass a long-term vision for sustained progress, focusing the national economic agenda, giving priority to address the issues of trade and industry in consultation with the business community which is the key stakeholder.

FPCCI former president and Businessmen Panel (BMP) Chairman Mian Anjum Nisar observed emphasized that such transparency from the government is crucial for instilling confidence in the business community and investors, as Pakistan, with all its resources and opportunities, cannot afford to continue to muddle through economically due to political polarization.

FPCCI former president observed that Pakistan requires a political consensus on economic policy. Freeing the country from its economic calamities should not be a matter of party affiliation, but a common task for all political actors who want to see Pakistan flourish.

He observed that the country has had trouble raising enough money to cover its expenses. Due to the low tax-to-GDP ratio, borrowing and outside help are heavily relied upon to close the fiscal imbalance. There is a recurring budget deficit because the government spends more than it takes in. The national debt burden has risen, as a result, needing substantial financial resources for debt repayment. Both internal and external debt in Pakistan has been constantly rising.

He called upon the government to announce clear and robust economic strategies, as the country has stuck in low economic growth situation, where double-digit policy rate for the last few years has diminished capacity to increase domestic production, and exports, negatively impacting domestic resource mobilization.

Anjum Nisar said that the new government that comes into office will have its work sharply cut out as far as the economic challenges are concerned. Coming at the back of fast-unfolding climate change crisis and recent Covid pandemic that pushed millions into poverty with little fiscal capacity of government to provide anywhere near close to what was needed in stimulus spending. Then there is acute debt distress, and seriously high inflation at the back of global aggregate supply shock, and accentuated by a world of rising conflicts, mainly in Ukraine, and the Middle East.

He said that even though Pakistan’s economic crisis is a recurring factor in the country’s political unrest, it has a history of ignoring the nation’s true issues, which include poor governance, a broken judicial system, outdated laws, complicated tax system, lack of transparency, duplication in the government system, ineffective bureaucracy, improper use of our human, natural and water resources, lack of efficient local government, inadequate data for country’s planning, and the consistent flaws in policies in execution by the government departments. Pakistan’s growth rate has always remained below its potential despite efforts to boost economic growth. The former FPCCI President said that the development of important sectors and investment prospects was hampered by inadequate revenue collection, structural problems, and governance issues.

Since it has been causing serious governance and economic issues for years, the cost of goods, food, petrol, and other necessities has increased, which is not bearable for the common man. On the other hand, there has been an increase in dissatisfaction among the public that no state institution is performing well and to save them from the haughtiness and bad administration pervasive in the system.

There is a dire need for a functioning economic strategy, and for continuity in its implementation, and protecting it from political meddling. He said that Pakistan’s economy is working, but only for its elite. Sustained, rapid, and equitable economic growth has remained elusive due to policy distortions that serve its selective sectors and classes.

Mian Anjum Nisar said that the business community is the key stakeholder to run the economy and the government should finalize the upcoming federal budget in consultation with major chambers and other trade bodies. He maintained that only solution that can steer Pakistan out of the crisis is indigenous with few basic elements, including making all economic policies in consultation with real stakeholders of the economy; simplification & broadening of the tax base instead of squeezing the existing tax payers; encouragement of remittances through bridging the gap between banking channels and open markets and protecting the assets of overseas Pakistanis in the country; incentivizing industry and export substitution.

The FPCCI former president said that Pakistan was in dire need of boosting trade and industrial activities in order to achieve early revival of economy and stressed that the government should bring down policy interest rate to single digit in the next budget that would pave way for availability of low cost credit to the private sector and accelerate the pace of industrialization and investment in the country.

He said that high GST was a major factor for high cost of doing business and hike in inflation for the common man; therefore, he urged that the government should bring down GST to single digit level in the upcoming budget in order to reduce the production cost and decrease inflation in the country. It would also make our exports more competitive in the international market.