The All Pakistan Business Forum (APBF) has suggested the government to announce incentives for oversees Pakistanis to further boost up foreign remittances, besides enhancing investment in the country by Pakistani expatriates.
APBF President Syed Maaz Mahmood observed that Pakistan’s economic growth, after reaching an 11-year high of 5.8 percent in FY18, is expected to see a decline during next two years. So, foreign remittances flows are the only hope which can support the current account balance, as the GDP growth is going to decelerate to 3.4 percent in fiscal year 2018-19 and further drop to 2.7 percent in FY20.
Maaz Mahmood, lamenting the gloomy picture of Pakistan’s position in the region with regard to its GDP growth in 2019, said that upward trend in remittances to Pakistan from overseas workers is a positive news for the country’s economy, as the Overseas Pakistani workers remitted $16.09 billion in the first nine months (July to March) of FY18, showing a growth of 8.74% compared with $14.80 billion received during the same period in the preceding year.
During March 2019, the inflow of workers’ remittances amounted to $1.74 billion, which is 10.73% higher than Feb 2019. The country wise details for the month of March 2019 show that inflows from Saudi Arabia, UAE, USA, UK, GCC countries (including Bahrain, Kuwait, Qatar and Oman) and EU countries amounted to $405.87 million, $378.14 million, $271.11 million, $281.26 million, $167.80 million and $44.20 million respectively compared with the inflow of $427.62 million, $424.89 million, $247.17 million, $258.96 million, $183.79 million and $58.91 million respectively in March 2018.
Remittances received from Malaysia, Norway, Switzerland, Australia, Canada, Japan and other countries during March 2019 amounted to $197.41 million together as against $202.26 million received in March 2018.
“It is also good news for the country that Pakistan’s trade deficit has narrowed 11 percent to $21.5 billion in the first eight months of the current fiscal year of 2018/19 but exports have risen marginally despite huge depreciation in rupee.”
Quoting the data of Pakistan Bureau of Statistics, he said that exports rose by just 1.8 percent to $15.1 billion, while imports fell 6.1 percent to $36.6 billion in the July-Feb period of FY2019 despite imposition of high duties on import.
If the government is eyeing $27 billion in exports revenue in the current fiscal year, it would have to take measures to boost exports and investment, he demanded.
APBF President noted that structural reforms can revive Pakistan’s economic growth with major focus on incentives for oversees Pakistanis workers.
Maaz Mahmood said that if government assists overseas Pakistanis and provides them incentives, they can play a pivotal role in boosting Pakistan’s economy through their remittances and investments for the socio-economic prosperity.
He remarked that oversees Pakistanis can invest in agriculture, transportation, telecom and energy sectors which have huge potential.
The government has badly failed to attract foreign investment because the persisting process of approval of projects discourages the investors, he added.
Syed Maaz Mahmood asked the bureaucracy to mould simple procedures by revisiting the existing processes so that the investors could be facilitated.
He said that export-oriented industries should be facilitated. He was of the view that rules, regulations and procedures for export-oriented sectors should be easy so that it could play its due role in economic stability of the country.
It is a matter of concern that exports are not improving significantly, besides the fact that country has all resources.
He said that we have to focus on investing in the energy sector, lowering of tariffs on smuggling prone items, increasing the share of direct taxes in revenue and lowering the slab of indirect taxes to achieve key economic targets set for the year 2018-19.