FPCCI urges govt to seek ‘concessional’ loans

KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on Saturday called for tangible steps from the government to capitalise and present the case of Pakistan with the international community for concessional loans if not grants or debt write offs.

The trade body criticised the government saying different approaches of two Finance ministers (Miftah Ismail and Ishaq Dar) had contributed in alarmingly low foreign exchange reserves as well as a delay in the International Monetary Fund programme, despite a fact that the country suffered catastrophic floods last year.

“This is incompetence and absolute lack of responsibility on government’s part to say the least,” FPCCI president Irfan Iqbal Sheikh said.

He stressed that all major exports of Pakistan had been in a decline for past 7 months, and the mainstay of exports, i.e. textiles registered a fall of 30 percent in February and 11 percent overall in 7 months.

Sheikh continued that IT and ITeS exports had also started to show a very concerning trend, as during first two quarters of FY23, they stagnated at $1.3 billion for six months. The current quarter was expected to show the same trend or even worse,” he added.

“The government keeps promising the moon to the IT & ITeS companies, but its own institutions like State Bank of Pakistan and Federal Board of Revenue fail to implement the directives of even the prime minister of the country.”

FPCCI chief expressed his concerns that the business, industry, and trade community had been left at a mercy of speculative trading in foreign exchange by commercial banks. “Why no action has been taken as yet against those five commercial banks that have been found guilty of speculative trading in an SBP inquiry?” he questioned.

He recalled that the current SBP governor had promised an action as per findings of the central bank in the third week of January, 2023, during his visit to FPCCI head office.

“No action has been taken and no compensatory measures have been offered to the business community in general and importers in particular,” he lamented.

Sheikh emphasised that export-oriented industries and the agriculture sector should be protected through targeted interventions and remedial measures. “Food insecurity is going to become an existential threat for Pakistan,” he said.

FPCCI chief maintained that prudential restructuring and rescheduling needed be embarked upon to reduce the annual debt repayments for at least next 3 to 5 years on all external loans except on those from international commercial banks and Eurobonds to protect country’s sovereign debt ratings at the same time.