Aggressive economic measures affecting businesses: PIAF
Business
Fluctuations in rupee against dollar are posing further challenges
ISLAMABAD (Web Desk) – Continually-increasing cost of production is a real threat to large-scale manufacturing and small-scale businesses, Pakistan Industrial and Traders Associations Front (PIAF) office bearers said.
PIAF Chairman Faheemur Rehman, senior vice chairman Nasrullah Mughal and vice chairman Tahir Manzoor observed that frequent upward revisions in policy rate and continuous fluctuations in rupee against dollar are posing further challenges.
They said the aggressive economic measures, high borrowing rates, inflation, oppressive taxation and unstable currency are negatively affecting the trade and industry, many of which have closed their operations.
The government does not have any pragmatic plan to address this liability, apart from asking for more loans to repay existing debt. Likewise, the target for current financial year’s exports is too low to meet the country’s revenue.
According to the data, the pace of growth in LSM industries is suffering because of restrictions imposed on imports that have caused a shortage of imported raw material. The steep currency devaluation has also made raw material expensive and business models unviable, they added.
The International Monetary Fund (IMF) assessed that the pace of negative growth in big industries could have been slower had the government not imposed restrictions on imports. The central bank has issued the guidelines to commercial banks about the allocation of foreign currency for import purposes.
Faheem Saigol said that the LSM trend indicates that this year that the overall Gross Domestic Product (GDP) growth rate may remain around 1% due to the shutdown of industries and adverse impact of the devastating floods on the agriculture sector.
