Karachi: The President of the Korangi Association of Trade and Industry (KATI), Johar Qandhari, has voiced strong criticism over the federal government’s recent budget, highlighting a complete lack of facilities and incentives for the industrial sector. Qandhari expressed disappointment, noting that the budget fails to address the development needs of industries and does not provide any strategy to reduce production costs or energy prices.
Qandhari pointed out that the budget includes an unprecedented 40% lump sum tax increase on exports, which has raised significant concerns within the business community. He emphasized that the burden on existing taxpayers has increased without a corresponding effort to expand the tax net. The lack of measures to promote investment, combined with increased taxes and duties on raw materials, will lead to higher product prices and stifle industrial growth.
“The government has failed to create policies to lower production costs or provide relief in energy prices,” said Qandhari. “This oversight discourages both local and foreign investment, pushing investors to consider relocating their industries abroad due to rising operational costs.”
He detailed the financial pressures facing industrialists, including high-interest rates, expensive loans, the highest electricity and gas prices, levies on petroleum products, increased transportation costs, and higher employee salaries. Qandhari stressed that industrialists are left to manage these rising costs while also dealing with infrastructure, security, personal expenses, and children’s education, all of which threaten the profitability and sustainability of their businesses.
Qandhari also criticized the budget’s additional taxes on current taxpayers, driven by the IMF’s demands, warning that such measures would only exacerbate inflation and push more people below the poverty line. He highlighted the complete tax exemption for the agricultural sector, which accounts for 26% of the GDP, as a concerning disparity.
“If the government aims to achieve an economic growth target of more than 3%, it must reduce taxes, provide incentives to the export industry, and expand the tax net to relieve the burden on current taxpayers,” Qandhari asserted. “Failure to do so will lead to decreased investment and the closure of industries, severely damaging the economy.”
Qandhari concluded that the federal government’s neglect of industrial development indicates a lack of commitment to promoting industrialization. He called for immediate policy changes to support the industrial sector and ensure sustainable economic growth.
