KARACHI: Irfan Iqbal Sheikh, President Federation of Pakistan Chambers of Commerce and Industry (FPCCI), has criticized the government for not being able to capitalize and present the case for Pakistan with the international community for concessional loans; if not grants or straight debt write offs.
This is incompetence and absolute lack of responsibility on government’s part to say the least, he added.
Irfan Iqbal Sheikh explained that the foreign exchange reserves of the country had to suffer a double blow due to the differing approaches of the two finance ministers of the same government vis-à-vis IMF program; and, that too, in less than one year. Which other country in the world manages their external account this way, he asked.
Sheikh stressed that the government should be aware of the fact that all major exports of Pakistan are in a decline for the past 7 months; and, the mainstay of Pakistani exports, i.e., textiles, has registered a decline of 30 percent in February and 11 percent decline over all in 7 months.
He continued that IT & ITeS exports have also started to show a very concerning trend, as during first two quarters of FY23, they stagnated at $1.3 billion for six months and this quarter is expected to show the same trend or even a decline.
The government keeps promising the moon to the IT & ITeS companies, but its own institutions like SBP & FBR have failed to implement the directives of even the prime minister of the country. FPCCI Chief has expressed his profound concerns that the business, industry and trade community of Pakistan had been left at the mercy of speculative trading in foreign exchange by commercial banks. He also questioned that why no action has been taken as yet against those five commercial banks that have been found guilty of speculative trading in an SBP inquiry.
Irfan Iqbal Sheikh has recalled that the current SBP Governor promised action as per findings of SBP in the third week of January during his high-profile visit to FPCCI Head Office; but, no action has been taken and no compensatory measures have been offered to the business community in general & importers in particular.
Sheikh reiterated his stance, as the chief of the apex body & feedback of the 250 associations and chamber, export-oriented industries and agriculture sector should be protected through targeted interventions and remedial measures. Food insecurity is going to become an existential threat for Pakistan, he added.
President FPCCI maintained that prudential restructuring & rescheduling should be embarked upon to reduce the annual debt repayments for at least next 3–5 years on all external loans; except on those from international commercial banks and Eurobonds to protect country’s sovereign debt ratings at the same time.
Copyright Business Recorder, 2023
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