Industry leaders slam govt failure in dealing with economic challenges

Published July 22, 2022
Zubair Motiwala says industries are unable to ascertain the selling price and manufacturing cost amid such intense exchange rate volatility.—Twitter/kcci_official
Zubair Motiwala says industries are unable to ascertain the selling price and manufacturing cost amid such intense exchange rate volatility.—Twitter/kcci_official

• Differ over notion Pakistan facing Sri Lanka-like crisis • Urge govt to fix dollar rate, appoint SBP chief, declare economic emergency

KARACHI: A sort of rift appears to have emerged as the top leadership of Businessman Group (BMG) has contested the warning of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) chief that Pakistan is heading towards a Sri Lanka-like crisis.

On Thursday, FPCCI chief Irfan Iqbal Sheikh told a press conference that a national security issue had emerged after a steep fall in the rupee value and if the dollar appreciation was not contained, “Pakistan would become Sri Lanka.”

He said importers were running from pillar to post in getting the dollar and in case the situation persists, a petrol crisis would emerge as banks were opening the letters of credit (LCs) at Rs242 for a dollar.

Highlighting the government’s non-seriousness, Mr Irfan said the government had yet to appoint a full-fledged State Bank of Pakistan (SBP) governor, while the acting SBP chief is not interested to meet with the FPCCI leadership.

As a result, commercial banks were enjoying a heyday by indulging in speculation about the exchange rate, which was evident from the forward buying of a dollar at Rs245, he said.

He urged the government to appoint a permanent SBP government in the next 48 hours and also fix rupee-dollar parity for the next 15 days to avert any serious economic meltdown.

Speaking at a press conference after chairing an SOS meeting of key stakeholders representing all economic sectors at the Karachi Chamber of Commerce and Industry (KCCI) on the current economic crisis, BMG chairman Zubair Motiwala ruled out the possibility of a Sri Lanka-like crisis saying that Pakistan was a land of 220m people and an agrarian country with very different dynamics.

Over 50 representatives of trade and industry including prominent businessmen like Muhammad Ali Tabba, Aqeel Karim Dhedhi and Ali Jameel attended the brainstorming session to find workable solutions to revive the deteriorating economy.

They called upon the government to immediately impose an economic emergency and fix the dollar rate for at least a month.

Mr Motiwala and KCCI President Muhammad Idrees expressed deep concerns over the government’s non-serious attitude towards dealing with economic challenges, heightened political uncertainty, steep currency devaluation, ineffective SBP role and unregulated profiteering by banks.

He demanded that the SBP governor should be appointed as soon as possible to manage the affairs of the central bank.

The industries are unable to ascertain the selling price and manufacturing cost of their products amid such an intense level of exchange rate uncertainty, Mr Motiwala added.

Mr Idrees said the decision to ban the import of raw materials to reduce import bill should be reconsidered as it will have adverse consequences on the economy as it will lead to halting the production processes, resulting in decreased progress, leading to reduced export quantity as well.

Meanwhile, Hyderabad Cha­mber of Commerce and Indu­stry President Adeel Siddiqui in a statement on Thursday urged Prime Minister Shehbaz Sharif to impose an economic emergency without any delay and also consult all stakeholders to find out a solution to the foreign exchange crisis.

He said that a crisis like Sri Lanka was staring at Pakistan and deplored the fact that the federal government had yet to appoint the SBP governor.

Published in Dawn, July 22nd, 2022

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

Opinion

Editorial

Fleeting good news
Updated 03 Dec, 2022

Fleeting good news

Indeed, there is no other option to get out of the economic mess we have created in the last few years.
Battle for spoils
03 Dec, 2022

Battle for spoils

THE spectacle playing out inside a London courtroom shines a light on the struggle for control of the assets of the...
CM Bizenjo’s complaint
03 Dec, 2022

CM Bizenjo’s complaint

BALOCHISTAN Chief Minister Mir Abdul Qudoos Bizenjo’s claim that his province is facing a financial crunch due to ...
Wayward ideology
02 Dec, 2022

Wayward ideology

Anyone who claims his legacy for themselves should not treat his words so whimsically.
Progressive stance
02 Dec, 2022

Progressive stance

THE timing of two encouraging developments in the fight against domestic violence in Pakistan could not have been...
China Covid protests
02 Dec, 2022

China Covid protests

PUBLIC protests are rare in China where the People’s Republic maintains order through a strict authoritarian code...