Export refinance for diversified sectors sought

KARACHI: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has demanded the central bank to ensure provision of export refinance scheme funds to diversified sectors, particularly the small and medium enterprises and solar power sector, a statement said on Saturday.

FPCCI President Mian Nasser Hayat Maggo said that the economic logic warrants more support to SMEs and new businesses rather than well-established business groups.

He termed it even more critical with clean energy sources such as solar, as Pakistan desperately needs more businesses to chip in.

The commercial banks continue to disburse 90 percent of the funds, coming under the export refinance schemes, to only a few chosen business groups, he regretted.

The whole exercise is biased and unfair, Maggo said, adding that the same practice continued with the export refinance scheme for solar plants and equipment.

“If this unfair practice continues, how (SMEs) will be able to remain in business and survive in these times of depressive pandemic-induced economic slowdown”, he questioned and urged the federal government and the State Bank of Pakistan to accommodate and encourage SMEs in the export refinance schemes.

Additionally, the SBP should instruct commercial banks to provide funds to diversified sectors under the schemes; instead of a few selected sectors, as Pakistan needs to broaden the base in its exports and the government and the central bank have a role to play, Maggo said.

He demanded the central bank to regulate the commercial banks effectively for the eradication of favouritism and unfair practices.

The FPCCI has demanded that a fair, transparent, and equitable mechanism must be devised in consultation with the business, industry, and trade communities of the country.