Lahore: Deputy Chairman Senate Saleem Mandviwalla on Monday called for a Charter of Economy that should be followed by all the governments saying that it is need of the hour.
While speaking at the Lahore Chamber of Commerce & Industry, Mandviwalla said that economic policies should not be changed according to the wishes of political parties as no country can move ahead without a stable economy.
On demand of the LCCI President, he said that Chambers should form a committee in collaboration with the Federation of Chambers of Commerce & Industry that will be notified and will be called in the meetings of concerned Senate committees.
He admitted that issue of refunds is hitting the business sectors hard. While calling for an out of the box solution, the Deputy Chairman Senate said that system of refunds should be fully automatic on the pattern of developed countries. “I would take this matter with the Finance Minister”, he added.
Mandviwalla said that all export-oriented industries should be zero-rated. He further said that existing volume of exports is a matter of concern. Pakistan’s exports are far less than Bangladesh and Vietnam despite the fact that country has the ability to boost the exports to $50 billion.
He underlined the need for a separate system for Export Development Fund. He said that EDF should have a separate bank account and should be given directly to the business community.
He said that budget process starts from January and budget proposals of business community should be reached to the government, FBR and Senate by the end of February so that these can be discussed and be made part of budget document.
He further pointed out that he has received many requests from all over the country from businessmen who have been harassed by National Accountability Bureau (NAB) which should not be allowed to take action against the business community as the businessmen and industrialists are already dealing with other departments including the FBR, FIA, SECP and others hence, there is no need for NAB. Instead, NAB should facilitate the business community by opening up a helpdesk at LCCI as done in Islamabad Chamber.
“Only trade and industry can put the country on the path of economic stability”, the Deputy Chairman Senate said and added that industry cannot play its due role in the presence of gas shortage, high input cost and delay in refunds etc.
LCCI President Mian Tariq Misbah in his address said that our industry is trapped in a cycle of negative growth rates and stagnation of exports in the last few years. Industrial growth rate was negative 2.64% in last year while our exports are stuck around $21 billion.
He said that there are various issues being faced by the business community which need to be addressed. He said that any business liquidity position matters a lot. In this regard the process of refunds for our exporters needs to be streamlined on permanent basis.
The LCCI President said that the incentives which are currently provided to the five zero rated sectors should also be provided to the other export sectors of the economy e.g. Engineering, Pharmaceuticals, Rice, Halal Meat, and Processed Food etc.
He said that there is a dire need of tariff rationalization to give boost to the industry. He proposed that all the raw materials not manufactured locally must attract zero custom duties. He said that government must eliminate regulatory duties and 2% additional custom duty on raw materials to increase the competitiveness of local industry.
Moreover, custom duties on intermediary products should be reduced so that the industry is able to import quality materials, components and machineries.
Misbah said that the modern time business requirements also include various certifications. There is a great need to improve our infrastructure as far as the Testing Labs and Standard Certification are concerned.
State of the art Testing Labs on the outskirts of Lahore and other major cities should be established through EDF. Furthermore, up-gradation of existing Testing Labs should also be done to bring them at par with international standards for serving the export needs of various industries.
He said that Pakistan needs diversification in export markets as around 60% of our exports go to just 10 countries. In order to enhance our exports to the untapped potential markets like Russia and Central Asia, formal Banking Channels need to be established on priority basis. State Bank of Pakistan should take keen interest in this regard.
LCCI Vice President Tahir Manzoor Chaudhry said that our economic growth has decreased from 1.9% to negative 0.4% in the recent times. The manufacturing sector is also facing a negative growth rate of 5.6%. This is a high time to promote and facilitate the business-led economic growth to overcome the economic challenges of Pakistan. The policy making in order to create a business friendly environment should be the top priority of the federal government.