LAHORE (INP): Small and medium enterprises (SMEs) play an important role as they constitute an integral part of the supply chain of key export industries including textiles, food processing and engineering etc. in Pakistan.
It was stated by Chief executive officer Pakistan Furniture Council Mian Kashif Ashfaq while talking to a delegation of furniture manufacturers led by Zahid Latif here on Sunday. He said the share of manufacturing-based SMEs in bank’s lending to the entire manufacturing sector is only 5.3 percent and nominal 11.5 percent in construction sector which needed to be increased manifolds to boost exports and productivity in line with USA and western countries. He said manufacturing and construction are the two largest job providing sectors in Pakistan.
He said expansion in e-Commerce and IT-ES can only prove qualitative for economic growth if the manufacturing sector continues to grow simultaneously. And for facilitating the growth of the overall manufacturing sector, promoting manufacturing-based SMEs is a must. He said if this not done, manufacturing-based Industry will opt for trading, leaving a vacuum in the supply chain of our key manufacturing industries.
Mian Kashif Ashfaq stressed the urgent need for using ultra-modern hi technology by SMEs to improve the quality of products and compete global markets at par with international standards. He said SMEDA claimed that SMEs contribute 40 percent to GDP and 25 percent to export revenue which is urgently needed to be boosted on the pattern of France, Italy, Japan, China, UK and other developed countries.
He said SMEs linked both vital sectors should never be deprived of due bank financing otherwise it may aggravate the chronic problem of unemployment. He urged the SBP to further ease the conditions of financing by addressing the issue of lack of acceptable security and high cost of bank finance models otherwise newly announced SME Assan (easy) Finance Scheme (SAAF) in collaboration with federal government will not yield desired results. He said SBP also must fully ensure that all “banks must invest on their own to reach out to the least served classes of borrowers like SMEs” he concluded.