Massive foreign investment shows success of Zarb-e-Azab, Karachi operation: LCCI chief

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LAHORE, Dec 20 (APP): Lahore Chamber of Commerce and Industry (LCCI) President Sheikh Muhammad Arshad on Sunday said inflow of massive foreign investment in the country showed success of opeeration Zarb-e-Azab by Pakistan Army in tribal areas and Rangers’ operation in Karachi.

Law & order situation in the country had improved with decreased incidents of terrorism, he said in a panel interview with APP.

The LCCI chief said trade delegations from China, Russia, Britain, Korea and other countries were now visiting Pakistan to explore business opportunities.

The foreign companies, he added, had declared Pakistan a best destination for investment.

The world was seeing the CPEC (China-Pak Economic Corridor) due its significance in regional as well as global trade, he said and added that the TAPI (Turkmenistan-Afghanistan-Pakistan-India) gas pipeline project had further enhanced Pakistan’s importance in the region.

He also underscored the need for restarting work on the Iran-Pakistan gas pipeline project soon after waiver of the United States sanctions on Iran.

Sheikh Arshad welcomed the Prime Minister’s announcement about ending power load-shedding by 2018. He, however, called for early construction of Diamir-Bhasha and other mega dams.

To a question, he said that electricity and gas crises had affected the textile sector and other industries. The initiatives taken by the government to enhance power generation would revive the industry and subsequently, create immense employment opportunities and increase overall export volume, he added.

The LCCI chief said some 2.5 to 3 million completed education every year, but their job requirement could not be catered to by the public sector alone. With the active support of the private sector, the government should take effective measures for the revival of industrial sector and announce a bailout package for textile sector at the earliest as it would create jobs, he added.

To a query, he said the LCCI was striving hard to find out a viable solution to the issue of withholding tax on banking transactions. The government, he said, should to take all the chambers and the Federation on board during formulation of economic policies.

Responding to another question, he said that Pakistan had low tax to GDP (gross domestic product) ratio in the region, which needed to be enhanced.

“Paying taxes is the obligation of every citizen, however, the Federal Board of Revenue (FBR) should lay more emphasis on broadening the tax net by bringing in untaxed sectors/businesses into it.”

Sheikh Arshad mentioned that industrialists were faced with severe liquidity crunch due to non-refunding of sales tax, income tax, customs and excise. Hev urged the FBR to refund billion of rupees to industrialists.

Replying to a query, the LCCI President observed that Pakistan was taking as much benefit of the GSP-Plus status by the European Union as the Bangladesh was.

After the grant of GSP-Plus to Pakistan, he added, India had given rebate to its industrial units enabling them to compete Pakistan in the international market.

He said that industrial production cost had increased manifold following the energy crisis, taxes and expensive raw materials, which rendered Pakistani merchandise uncompetitive at global level.

He urged the government to remove such bottlenecks, which would help increase the exports.

About Pak-India trade, Sheikh Arshad suggested that Pakistan should do trade with India on equal footings. He also called for early settlement of the Kashmir issue to make free trade possible between the two countries.

He mentioned that duties/taxes on trade through  Chakothi route was zero, while traders had to pay huge duties on routes of Wagha and Karachi. The two countries, he suggested, should abolish non-tariff barriers.

Sheikh Arshad said that exchange of trade delegations and organizing single-country exhibition would prove instrumental in increasing the bilateral trade volume, asserting that only one visit could not help enhance trade but maintaining constant liaison with other countries could do miracles.

He said the LCCI had the credit of sending trade delegations abroad purely on merit and it was a premium chamber of country due to the largest number of members and most importantly, its proposals were incorporated in the federal budget.

Responding to a query, he said that oil prices had now at its lowest ebb at international level and Pakistan would have fiscal benefit of $6 billion per annum with decrease of petroleum products’ import from $16 billion to $10 billion.

However, the country’s import bill would remain at $47 billion and export at $22 billion that might further widen the trade
deficit.

He urged the government to reduce the import bill and enhance exports that would not only help bridge the trade deficit but also narrow down the fiscal deficit thus stabilizing Pak rupee against the US dollar. He also opposed the devaluation of Pak rupee. The rupee value could be enhanced through raise in exports.

Sheikh Arshad said that prices of agri produces- wheat, rice and sugar were lowered at global level, and despite having bumper crops, Pakistani growers and agricultural exports were now unable to get due price of their commodities. He also called upon the government to take effective measuresand formulate a solid policy in this regard.

The LCCI President also stressed the need for export of information technology, citing that at present, India’s major chunk of exports based on the IT. He also underlined the need for increasing exports of light engineering, marble, granite, livestock and dairy products.