Government urged to reduce cost of doing business

The business community has urged the government to reduce the cost of borrowing to offset the impact of the raise in petroleum and electricity prices and imposition of flood surcharge that has significantly increased the cost of doing business in the country.
Talking to Business Recorder, the President of the Federation of Pakistan Chamber of Commerce and Industry (FPCCI), Hamid Chadda, said that with the increase in petroleum prices, the transportation cost involved in import and export has increased manifold. In addition, flood surcharge has been slapped on import of raw material, which is making it difficult for the exporters to fulfill their commitment. "We are asking the government to sit with the business community and solve these problems."
He also urged the SBP to reduce interest rates and electricity price and ensure regular supply of gas to the industrial units. President of Islamabad Chamber of Commerce (ICCI), Mehfoz Elahi, said that increase in petroleum and electricity prices has increased input costs. In addition, he said, the ongoing load shedding was adversely impacting the industrial sector and increasing the productivity cost.
On top of it, the State Bank of Pakistan's (SBP) decision to keep interest rates high to control inflation was making business difficult in the country. He said that high interest rates have not been able to bring down the inflation but has simply increased the cost of doing business. Mahfooz suggested three measures as a first step to promote an environment conducive to business activity: (i) interest rate should be brought down to 4 percent for industrial sector; (ii) uninterrupted electricity supply; and (iii) availability of raw material. He said that the increase in petroleum prices would have an inflationary impact on the entire economy and these measures would offset to some extend the impact of price increase of inputs.