LAHORE: Secretary Board of Investment (BoI) Asad Rehman Gilani has said that 70 different types of regulators are working in our country. It has become a regulatory regime in which the industry is bound. This should not happen.
He was speaking at the Lahore Chamber of Commerce and Industry. LCCI President Kashif Anwar also spoke on the occasion while executive committee members were also present.
Secretary BoI said that we talk about the investment but we have to take care of domestic investment along with FDI. Our own people have established industry by working hard. Now we have to nurture the domestic industry.
He said that BOI has launched the Pakistan Regulatory Modernisation Initiative (PRMI), which aims to modernise the regulatory regime and prevent regulators from becoming rigid. He said that one of the ways to do this is to talk to all the regulators to identify the regulations that have been in their rule books for 75 years that are completely obsolete. The applicable regulations should be entered in the BoI registry and the rest should be removed.
He said that the laws that issue notices to businesses for minor infractions should be relaxed. The overload of notices will be eliminated. Regulations will be minimised and any new regulations will be finalised after study and consultation with the business community, he added.
He said that under PRMI, regulators will be trained and instructed on how to make regulations. He said that it has been noticed that there are 20 to 22 regulators in the IT sector alone. We have created a registry, the purpose of which will be to give one application instead of going to different departments. BOI will conduct clearance from all 22 departments. So far 10 regulators have expressed their willingness with us. After that we will move to other sectors like pharmaceuticals, steel, etc.
He said that Invest Pakistan has been launched with the support of the British government. We want the business community to sit with us for the “Invest Pakistan” programme and five-year policies should be formulated. Business community should cooperate with us in national interest.
LCCI President Kashif Anwar said that Lahore Chamber has always emphasised on making the Rules & Regulations simple and business friendly so that the business climate in the country can be improved and all possible facilitation for the investors should be ensured. This will definitely help in promoting Ease of Doing Business.
He said that promotion of foreign investment as well as local investment is the most important need of the hour. According to the Economic Survey of Pakistan, the ratio of total investment in our country is only 15% of Gross Domestic Production, which is quite low. The share of private investment in this is only 10% of GDP, which has become inevitable to increase. We hope that BOI Initiatives like Invest Pakistan will be helpful in this regard.
The LCCI president said that if we talk about the data of Net Foreign Direct Investment, it was US 2.6 billion dollars in 2019-20, which decreased to US 1.82 billion dollars in 2020-21, while in 2021-22, its volume was limited to only US 1.87 billion dollars, which is extremely low in terms of requirements of the economy.
He said that local investment cannot increase until the problems of local industries are solved. For example, our industries have to import a lot of raw materials, essential components and various types of machinery which are not available in the country. They have to pay regulatory duties, customs duties and additional customs duties on them, which need to be eliminated. Besides reducing the rate of withholding tax for businesses, the issues of pending refunds and multiple audits should also be resolved.
He said that in order to promote local investment, our government has to solve some problems related to taxation on a priority basis, which will also improve the ease of doing business. Currently taxpayers have to undergo multiple audits of income tax and sales tax. He appealed that the number of these audits should be reduced. Taxpayers face penalties, surcharges and inquiries on these audits, withholding of registrants, penalties for late filing of statements/income tax returns and many other issues. The rate of penalties and surcharges should be reduced immediately for taxpayers.
Copyright Business Recorder, 2023