LAHORE: Federal Minister for National Food Security and Research Rana Tanveer Hussain on Saturday acknowledged that industrial expansion and investment remain constrained until tax rates are competitive and the policy rate is lowered further, calling the present cost of doing business “a drag that turns industrial growth negative.”
Speaking during a visit to the Lahore Chamber of Commerce and Industry (LCCI) where he met President Faheem-ur-Rehman Sehgal, the minister said operating when interest rates were at 22 per cent had been extremely difficult for business. “The rate is now 11pc and will be reduced further,” he added, arguing that lower borrowing costs are essential to restore momentum in manufacturing.
Rana Tanveer Hussain maintained that while Pakistan had averted default, growth had slowed under the International Monetary Fund’s programme. “IMF’s stringent conditions require its concurrence in every major policy decision, which inevitably tempers the pace of expansion,” he said. Linking food security with national security, the minister said the wheat support price had been fixed at Rs3,500 per maund to protect farmers from losses. He pointed to “serious gaps” in agricultural research and on-farm productivity, stressing that without closing these gaps “food security will remain elusive.”
He termed tougher action against counterfeit seed, the creation of a National Seed Regulatory Authority and the rollout of a track-and-trace regime as critical reforms.
LCCI President Faheem-ur-Rehman Sehgal pressed the government to push the policy rate into single digits and cut taxes to jump-start industrial activity. Calling it a paradox that an agrarian country is importing food items and livestock-related products, he said this underscored deep structural imbalances. He warned that “unless exports rise to the $100 billion mark, Pakistan’s economic problems will not be resolved,” and urged immediate reforms to lift overseas sales. Sehgal said nearly “50 per cent of the population has fallen below the poverty line,” adding that inflation was fueling a rise in crime. He cited post-harvest losses of about 30pc and argued that without research, value addition and modern supply chains, agriculture cannot underpin the broader economy. The business community, he said, wants policy continuity, a higher research budget and competitively priced electricity through a lower energy tariff for industry.
Reassuring the private sector, the federal minister said the government was “committed to the revival of both industry and agriculture” and would continue to work closely with the business community to remove bottlenecks and restore growth.