KARACHI: Pakistan Business Forum (PBF) has urged the Prime Minister (in-waiting) to appoint a politician on the slot of the Finance Minister of the country, so that he could understand the local dynamics.
President Pakistan Business Forum Khawaja Mahboob ur Rehman also strongly demanded of the government (in-waiting) to re-evaluate policy of continuously increasing energy prices on an immediate basis; particularly, the decision to increase captive gas price to Rs 2,750/MMBtu, an increase of 223% since January 2023 that has threatened the very survival of Pakistan’s industrial sector.
He said that the direct consequence of spiralling energy costs is an increase in production costs across all industrial sectors, forcing businesses to pass these costs onto consumers.
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This results in widespread price increases; exacerbating the financial strain on consumers already battling relentless inflation for the past two years, he added.
PBF President stressed that the consumer demand was poised to reduce further as a result, which would further prompt a reduction in manufacturing activities.
The resulting inflation also rules out any possibility of a reduction in interest rates in the foreseeable future, leading to further downfall of the private sector.
Khawaja Mahboob urged the government to conduct all encompassing reassessment of its energy pricing framework as electricity prices for industrial consumers are well above 17 cents/kWh which is twice as high as those in regional economies like Bangladesh and India. With yet another increase in gas prices, manufacturing activity is no longer financially feasible in Pakistan and there will be no investment – domestic or foreign in the country under these conditions.
Copyright Business Recorder, 2024
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