Daily Times

Lahore Chamber of Commerce and Industry (LCCI) on Monday expressed concern over the hike in fuel prices and urged the government to withdraw this decision.

LCCI President Kashif Anwar, Senior Vice President Zafar Mehmood Chaudhry,

Vice President Adnan Khalid Butt and Executive Committee, in a media statement here, observed that this would add to the already increased cost of doing business (CODB). They urged the government to take immediate measures to control the rising inflation and CODB. They shared that statistics issued by World Bank which indicate that only two percent economic growth was anticipated in Pakistan for the current fiscal year. They added that slower development would be due to damages and disruptions brought on by catastrophic floods, a tight monetary policy, rising inflation, and an unfavourable global environment.

The LCCI office-bearers claimed that actual GDP growth was anticipated to reach 3.2 percent in next fiscal year, signaling a modest recovery and if not tackled professionally this low growth would lead to further inflation and unemployment.

LCCI President Kashif Anwar argued that exchange rate was 17 percent, rupee was devaluating and now raise in POL prices would add to the miseries of trade and economy.

They added that due to the current flooding, poverty would probably go worse in the hardest-hit areas and without resolute relief and recovery initiatives to aid the poor, preliminary projections indicated that the national poverty rate might rise by 2.5 to 4 percentage points, putting between 5.8 and 9 million people in poverty. They said as Pakistan struggled with issues like a current account deficit, huge public debt, and decreased demand from its traditional export markets during muted global growth, macroeconomic risks also remained high. They also called to bring down markup and KIBOR rate in the larger interest of the industry. They said that lower markup rates made it cheaper to borrow for the industrialists. State Bank of Pakistan should bring down the markup rates to a single digit that would encourage the industries to take out loans to expand their operations.

They said that high cost of borrowing was discouraging the demand of credit by the private sector and slowing down the economic activities.

They said that reduction in markup rate from existing 17 percent to single digit would be a great favor to the industrial sector as it would help the government to attain the target of industrial growth; reduce the cost of production and also bring capital of the banks into circulation.