Daily Times

The Ferozepur Raod Industrial Association (FRIA) has asked the authorities to undertake economic reforms and improve the regulatory environment for better Ease of Doing Business (EDB) level to boost foreign investment so that financial stability can be achieved in the long-run.

The FRIA Chairman Shahbaz Aslam stressed the need for reducing cost of doing business, besides evolving a new price control mechanism, as huge taxation, rising oil prices and constant jump in electricity and gas tariffs have lifted the inflation to decades high level in 2024.

Shahbaz Aslam said that according to the World Bank’s Ease of Doing Business report, Pakistan’s ranking has fluctuated, reflecting persistent obstacles such as bureaucratic red tape, complex tax regulations, and insufficient infrastructure.

In the Doing Business report, Pakistan ranked 108th out of 190 economies, showing some improvement from previous years but still indicating significant room for enhancement. Previously the country was even worse off, standing at 136 in 2019.

He said that not the extensive borrowing but improving the Ease of Doing Business Index of the country was vital to put the country’s economy back on track.

He alleged all previous governments for extensive borrowing of forex during last five years to meet local expenditure, which had increased the burden of foreign debt of Pakistan substantially, instead of making serious efforts to enhance the ranking of Ease of Doing Business Index of Pakistan, as it is must to attract foreign as well as local investment and high economic growth.

The FRIA chief warned the authorities that inflation can hurt economic growth and a careful policy is required to keep it in control. He said that the pace of inflation is skyrocketing at a time when the economic activity is slowing down.

As the oil prices have been increased and power tariff has gone up further, the chairman stated that the government has dropped a fuel bomb on the businessmen after it suffered an electric shock to meet the conditions of IMF for the revival of the stalled loan program- a recipe to shake the trade and industry.

He said that the decision would prove detrimental to the industries due to high cost of doing business and will also open the floodgates of inflation. In addition to making the electricity bills costlier and unaffordable for the consumers, the hike in base tariff would escalate prices of all household goods being widely used in every household, he added.

He said that Pakistan’s industry had been harmed by the high cost of doing business, which discouraged investment in capacity and capability and called for easing the burden of heavy taxes on the power sector.

He stated that the constant increase in power tariffs on the pretext of fuel adjustment had increased electricity prices and added to the already high cost of trade and industry.

The FRIA chief urged the power ministry to identify system constraints and communicate targets to all concerned departments in order to launch a wartime effort to upgrade the transmission system.