THERE appears to be a shift in the political positioning of the business community that has historically preferred autocracy to democracy. Despite their reservations over the Nawaz government’s policy focus, this time round corporate Pakistan resents the anti-PM campaign that, they perceive, ‘hurts more than helps’ the economy.

Business leaders are not very happy with the ruling party’s policies that, they assume, are guided by the powerful revenue-oriented Ministry of Finance. The thrust has been to recover revenue shortfalls from tax compliant corporate citizens already burdened with excessive taxation and high utility charges.

The textile tycoons are particularly critical of slow disbursement of tax refunds which impacts the viability of their businesses, and lament lack of required support to arrest falling exports. Businessmen approached for their views on the current political scenario were reluctant to own their comments but wanted public projection of their views.


Over the past two weeks the real estate prices have climbed. Investors are again looking for short-term options


They detested the political build-up against the elected government by the media and the opposition parties. They dismissed the overseas shell companies-related corruption charges against the PM as frivolous and believed the allegations will not stand ground in a court of law.

They criticised the media for provoking public and the opposition parties to take the issue to the streets. They termed it ‘a dangerous game’ that has potential to derail the democratic order.

Experts believe that the change in the positioning of the business elite is not necessarily based on principles but rooted probably in the fear factor and in their interest. “The business class dreads political instability and broad based accountability drive for obvious reasons,” a former economic minister said.

It was gathered, from discussions with the leading businessmen, that they are seriously evaluating options of investment to capitalise on new avenues offered by China-Pakistan Economic Corridor. A political mayhem, they think, could paralyse the decision-making machinery of the government and force the private sector to put their investment plans on hold.

The talk of a broad-based accountability understandably causes anxiety more than excitement in business ranks. Besides the businessmen identified in the list of Pakistanis that surfaced with Panama Papers, others accused were equally averse to the idea of public audit of their businesses and assets. They argued that a witch hunt would backfire particularly at this point when the country has achieved significant stability and poised for rapid economic growth.

“Pakistan desperately needs investment. Any policy that scares business class will repress their level of participation and prompt people to dig deeper to hide their wealth,” a third generation industrialist said.

They insisted that it is time for politicians to rethink their approach: ditch fake morality and think development. Sermons don’t feed people, employment does. There is no way to induct teeming millions in the economic mainstream if the manufacturing and agriculture base is not expanded. To me any move that hampers investment is regressive,” another leader said.

Speaking of the challenges to entrepreneurship a cement tycoon said, “Business is not for faint-hearted in Pakistan. The moment you rise above the rest, you have to deal with mafias of all hues, shapes and levels. With patronage culture deep-rooted wheeling and dealing is unavoidable. How can people ignore security risks when they demand public declaration of assets?

“The community hopes the system will not be derailed also because the world has become less tolerant of authoritarian regimes.

“Pakistan is already treated as a pariah. The democracy needs to be defended also because the country can’t afford Western sanctions. In modern interconnected world the cost of violating international norms is too high,” a nervous businessman of Karachi said, highlighting the cost to the economy of any misadventure.

Eizaz Sheikh, CEO Kohat Cement, found the reaction to Panama Papers over board and orchestrated. “Westerners believe the worst democracy is better than the best dictatorship. There can be nothing that justifies constitutional misadventure to test the country’s endurance again”.

“It is so unfortunate. At long last things were looking good and investors were discussing projects instead of options to park their wealth. I just hope and wish that better sense prevails and the government and the opposition settle the issue across the table”, said another businessman.

“The situation is more critical than most people comprehend. Pakistan is again gripped by fear. Over the past two weeks the real estate prices have climbed. People are again looking for short-term options. You will see money flowing into the capital market and trading in search of quick returns. This does not bode well for the economy,” he added.

A textile tycoon, whose name is included in the list, was candid. “What about onshore beneficiaries of undeclared assets?” he asked. “For every deal tax is paid on ‘purchase’ price that is a fraction of the market value. In just last three years hundreds of billions worth of properties changed hands under DHA’s management in Karachi, Lahore and Islamabad”.

Published in Dawn, Business & Finance weekly, May 2nd, 2016

Follow Dawn Business on Twitter, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

Afghan turbulence
Updated 19 Mar, 2024

Afghan turbulence

RELATIONS between the newly formed government and Afghanistan’s de facto Taliban rulers have begun on an...
In disarray
19 Mar, 2024

In disarray

IT is clear that there is some bad blood within the PTI’s ranks. Ever since the PTI lost a key battle over ...
Festering wound
19 Mar, 2024

Festering wound

PROTESTS unfolded once more in Gwadar, this time against the alleged enforced disappearances of two young men, who...
Defining extremism
Updated 18 Mar, 2024

Defining extremism

Redefining extremism may well be the first step to clamping down on advocacy for Palestine.
Climate in focus
18 Mar, 2024

Climate in focus

IN a welcome order by the Supreme Court, the new government has been tasked with providing a report on actions taken...
Growing rabies concern
18 Mar, 2024

Growing rabies concern

DOG-BITE is an old problem in Pakistan. Amid a surfeit of public health challenges, rabies now seems poised to ...