Business community demands another incentive package

LAHORE (INP): Business and industrial community alike Saturday urged the government to announce another incentive package immediately to save economy from collapsing besides further reducing policy interest rate to 5 percent to offset gradually the negative impact of coronavirus.

SAARC Chamber of Commerce and Industry (CCI) President designate Iftikhar Ali Malik discussed the plight condition of the business community with the veteran trade leader and patron-in-chief of United Business Group S.M. Munir on telephone and both the leaders were agreed that the recent incentive package announced by Prime Minister Imran Khan for industry and State Bank of Pakistan slashing interest rate to 9 percent are not enough for the revival of the industry as the damage is colossal done to local industry in Pakistan due to coronavirus.

They have urged the State Bank Pakistan to further cut policy rate for easy access to finance for the local industry and exporters who are confronting new challenges and uncertain conditions.

Iftikhar Malik said the value-added sector demanded immediate payments of sales tax refunds and rebate, waiver of mark-up in export refinancing and relaxation in loan repayments, deferment of payment of utility bills and waiver of surcharges for at least next three years, restoration of zero-rated sales tax regime and exemption from welfare fund contributions.

He said that the government’s resolve to contain the spread of virus was commendable and foreign industries were now considering relocating to Pakistan due to it.

On behalf of the manufacturers, he said that incentives such as the cut in import duty on the required raw materials must continue unabated as it would ensure an economic stimulus.

He said the global oil price reduction comes as a mercy at a time when the entire machinery has shifted gear on exploiting the optimum export potential.

Iftikhar Malik opined that a lowering of interest rate at 5 percent together with cheaper oil import shall raise future expectations of investors and serve as vantage point for Pakistan in steadily conquering the budding trade gap in GSP Plus backed markets of Europe. “Moreover, it would also make business climate more lucrative for foreign investment in the ongoing pandemic,” he added.

He said that presently effective power houses like USA, UK, China, South Korea and Japan who controlled 65 percent of the manufacturing industry of the world were being in trouble whereas Pakistan still can meet the challenge and can grow its economy.

He also urged the State Bank to draft a separate policy for micro and small enterprises to enable them to keep their workforce, survive in current critical conditions and sustain in the long term.

Micro, small and medium-sized businesses accounted for roughly 70% of Pakistan’s economy and provided employment to more than 10 million people, he highlighted.

Iftikhar Malik feared that the economic impact of Covid-19 would lead to the closure of many businesses as they were suffering from lockdowns and generating no income.