The Pakistan Economy Watch (PEW) on Tuesday said the government’s decision to give power subsidy to the export sector is commendable, which will increase domestic exports and stabilize foreign exchange reserves.
The subsidy will ensure the provision of electricity to the export sector at Rs19.99 unit, it should not only benefit the manufacturers but workers as well who are reeling under unprecedented inflation, it said.
Government should link subsidies to the working conditions and wages of the workers in the factories of the export sector, said Dr. Murtaza Mughal, President of PEW.
Apart from this, a guarantee of increasing production and quality should also be taken from the manufacturers, he added.
Dr. Mughal said that the state of the country’s treasury is thin, therefore, instead of resorting to subsidies, the industrial sector needs to improve the quality of its products and the ability to compete with rivals in the international market.
He said that the government has not yet explained where from it will arrange almost Rs100 billion to provide cheap electricity to the export sector.
He said that actions that can offend IMF, other creditors, or friendly countries should be avoided.
Pakistan has faced a very dire situation and was compelled to secure loans of harsh conditions due to structural weaknesses therefore removal of such issues should be given top priority, he suggested.
