The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) Regional Chairman Muhammad Nadeem Qureshi has forewarned that the abrupt withdrawal of power sector subsidy to appease IMF is set to decrease exports even further; which have already been in decline for the last 6 months consecutively, i.e. August 2022 – February 2023 as per the numbers released by Pakistan Bureau of Statistics (PBS).
Nadeem Qureshi categorically termed the monetary policy as the worst in the country’s economic history; and, has predicted that it will bring the economic, trade, investment, and commercial activities to a standstill – a doomsday scenario for the business, industry & trade community of Pakistan.
Nadeem Qureshi added that, as per the latest statistics, Pakistani exports have declined by a hefty 18.67 percent in February 2023 on a YoY matrix from $2.83 billion in February 2022 to $2.31 billion in February 2023; whereas, the government is not willing to accept the ground realities and trying to make us believe that the decline is merely in the vicinity of 10 percent.
Nadeem mentioned that the aforementioned power subsidy had to end by June 2023 with a tangible possibility of renewal or renegotiation. However, the government has withdrawn it in the most harmful manner to export-oriented industries.
FPCCI Regional Chief has apprised that now commercial banks would not lend to businesses for anything less than 22.5– 24 percent interest rates; and, no business can find it affordable anymore. This will result in the complete drying up of the private-sector lending from the banking or formal sectors; which has already been availed only by approximately 7 percent of the businesses over the past many years, he added.
Nadeem Qureshi highlighted that Pakistan now ranks one of the lowest in access to finance and cost of doing business indices in almost the entire region; and, instead of consulting the business community, the government has continued their tradition of consultation-less policymaking; consequently, ignoring the real stakeholders of the economy.
Withdrawal of power subsidy to decrease exports: FPCCI
