Ayesha Saba

Business leaders and experts have demanded that the government provide affordable energy to the industry as high electricity tariffs have stifled the sector. Speaking to WealthPK, Majid Shabbir, an adviser to Islamabad Chamber of Commerce and Industry, said that the industrial sector, a significant contributor to Pakistan's GDP and employment, was already under considerable strain. "At the forefront of Pakistan's economic hurdles is the high cost of doing business. Burdensome electricity tariffs stand out as a significant barrier and a substantial blow to an already beleaguered sector," he pointed out. "As businesses are still recovering from the disruptions caused by the supply chain issues, the increase in production costs will inevitably squeeze their profit margins, forcing companies to either absorb the costs, pass them on to consumers, or reduce their workforce," Majid warned.

"The hike in electricity tariffs is unjustifiable and will have far-reaching consequences for our competitiveness as we are already facing numerous challenges, including high inflation and reduced consumer spending. Addressing these exorbitant energy costs is paramount to revitalising the manufacturing and production sectors," he emphasised. "The government should invest in renewable energy sources to reduce dependency on expensive, non-renewable energy," he recommended. "This will provide a more sustainable and cost-effective energy supply for industries," he stressed. Mian Anjum Nisar, Chairman of the Businessmen Panel, and former Federation of Pakistan Chambers of Commerce and Industry president, highlighted the urgent need for reducing the import bill by imposing bans on luxury products.

"This will help conserve foreign exchange reserves and focus resources on essential imports." He also emphasised the importance of containing the cost of production. "Businesses are struggling with high operational costs, and we need policies that support local industries and keep production costs manageable." He maintained that businesses were already struggling with high operational costs and cannot survive if electricity remains remained unaffordable. "Suspending sales tax will provide much-needed relief and support economic recovery." "There is an urgent need to reassess economic policies, as economic indicators throughout fiscal 2023-24 have been deeply troubling. High inflation, low export levels, dwindling foreign reserves, and the ongoing instability of the local currency have all contributed to a bleak economic outlook," he observed.

Credit: INP-WealthPk