(August-07 -2023) Chairman of National Business Group Pakistan, President Pakistan Businessmen and Intellectuals Forum, and All Karachi Industrial Alliance, and former provincial minister Mian Zahid Hussain said on Monday that the policy of promoting consumerism in the country without expanding the industrial sector has caused irreparable damage to the economy.
This policy did not benefit the local industries, but the industrial sector of other countries with Pakistan’s resources, he said.
Mian Zahid Hussain said that the relentless imports of luxury goods, manufactured goods, and luxury vehicles are living examples of this.
Talking to the business community, the veteran business leader said that it is necessary to give priority to the industry over trading and real-estate sectors while creating a practical and feasible policy to increase the tax base because Pakistan still needs to collect Rs4000 billion more in taxes.
Pakistan can widen the tax base and enhance collections, for which a plan is needed to relieve the country of its unbearable deficit. Enhanced tax collection can help the government provide relief to the poor and fund developmental as well as mega projects, he added.
The business leader said that last year, Pakistan collected taxes of 7200 billion rupees, while 7500 billion rupees were required for debt servicing.
Mian Zahid Hussain said that debts and liabilities have grown beyond manageable limits. The country is no longer able to repay the loans to the IMF, other international organisations, and CPEC-related loans, and the system is being run on the rollover of loans.
The cost of all these factors is being paid by the public and private sector; businessmen are not getting loans while the interest rates and prices of petroleum, electricity, gas, and food items are skyrocketing.
Issues of super tax, wealth tax, and withholding tax are also hurting the economy. At the same time, the public and private sectors are forced to foot the bill for keeping state-run entities artificially alive for decades.
He said that the news of serious investment by the Arab countries and their private sector is hot, and SIFC has been established with the support of the Army Chief to provide a one-window facility to foreign investors, which is a source of happiness and hope.
Mian Zahid Hussain said that SIFC is expected to attract an investment of 25 to 30 billion dollars, while there are reports of restarting the stalled work on CPEC, which will enable further investment, the opening of Special Economic Zones, and the availability of world-class infrastructure, which will result in a two percent increase in GDP.
Such initiatives will stop the flight of capital and brain drain, he said, adding that it is necessary to restore the confidence of the business community and people in the economic policies and the current economic situation of the country.
This will not be easy, but it will not be impossible for the caretaker PM and his cabinet, who will face difficult choices.
The size of the interim government needs to be kept down, and reviving the economy will require bold and energetic action from the caretaker government and the incoming elected government, he said.
