According to media reports, a Pakistan Business Council (PBC) delegation that has recently met the Governor of the State Bank of Pakistan (SBP) to discuss economy and offer suggestions for alleviating some of the challenges facing businesses is said to have conveyed its satisfaction over the steps taken by the government and the central bank to revive the IMF programme.
In my view, PBC appears to be bereft of a grim reality that has found its best expression from the ordeal of a number of sectors, including the steel industry.
All of these sectors are facing the grim prospect of closure of a large number of units on account of SBP’s increasingly administrative controls over foreign exchange or LCs.
The delay in opening of the LCs has caused a severe shortage of raw materials, leading to production delays and financial losses for companies. This has caused a crisis-like situation in the pharmaceutical sector in particular.
The production losses in these sectors have caused artificial hikes in prices of items produced or manufactured by them.
This situation will ultimately lead to massive job losses. The PBC, in my view, is requested to take these facts into account before it makes its next move in the larger interest of businesses in Pakistan.
Noman Bashir (Karachi)
Copyright Business Recorder, 2023
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