The Sindh industrialists have shown concerns over Pakistan’s rising debt burden, which has not only ruined the national economy but also adversely impacted the common man in the shape of runaway inflation. They called for policies to reduce dependence on loans by creating more revenue streams in order to make the country self-reliant. They also suggested that the government implement austerity measures in letter and spirit in order to save national wealth. Farazur Rahman, Patron-in-Chief of Businessmen Group, told WealthPK that the huge external and domestic debt was weakening Pakistan’s economy, resulting in a negative impact on businesses of different sizes as well as individuals from varying income groups. He underscored that the government should reduce reliance on external debt by containing imports with strict control over unnecessary and luxury goods. “On the other hand, it should promote local industries, particularly small and medium-sized enterprises – which are the backbone of the economy – to meet the domestic demand for raw material and essential items from industries and individuals.”

Rahman said long-term policies were required for SMEs, industries, and the agriculture sector by creating opportunities for foreign and local investors. “Besides, a customised financing scheme should be introduced at low mark-up rates to encourage businessmen to expand their businesses.” “The government should work on the broad theme of ‘Made-in-Pakistan’ to promote local brands, while also looking to explore various avenues to generate foreign exchange such as exports, remittances, foreign direct investment and other such sources,” he stressed. Muhammad Farooq Shaikhani, President of the Hyderabad Chamber of Small Traders and Small Industries, said Pakistan was enduring sluggish economic growth, escalating inflation, rising unemployment and the formidable burden of both internal and external debt, which surged significantly in recent years. “Pakistan has long been ensnared in a ‘debt trap’ exacerbated by the recent increases and the contracting economy, and as a result, the repayment of debt and interest has become increasingly untenable,” he said.

Shaikhani recently wrote a letter to Federal Minister for Finance Muhammad Aurangzeb, giving suggestions for debt mitigation. “The government’s practice of taking loans from banks at an exorbitant 22% rate is tantamount to attempting to collect water with a sieve,” he remarked. Shaikhani was of the view that lending conditions with huge interest rates were a source of discouragement for investors and industrialists desiring to set up new industrial units. Nadim Memon, a prominent industrialist in the SITE industrial area, called for creating a conducive environment and providing affordable loans to boost Pakistan’s exports. He also asked the government to collect data on small traders, farmers and daily wage earners to formulate a consistent economic policy. He said the government should work proactively to tackle the issue of huge debt, which otherwise would sink the boat of the national economy.

Credit: Independent News Pakistan