Pak­istan Busi­ness Coun­cil Driv­ing the Na­tional Econ­omy

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The Pak­istan Busi­ness Coun­cil was es­tab­lished in 2006 by four­teen of the coun­try’s lead­ing busi­ness groups and com­pa­nies, in­clud­ing multi­na­tion­als, cov­er­ing a di­ver­sity of busi­ness ac­tiv­ity. The PBC is not a trade body but was cre­ated as a fo­rum for Pak­istani busi­nesses to ad­dress the chal­lenges aris­ing from pro­gres­sive global and re­gional free trade and from the rel­a­tively slug­gish trends in cur­rent na­tional In­vest­ment flows, against the much higher lev­els needed to sus­tain Pak­istan’s GDP growth at 7%-plus.

PBC works at pro­duc­ing po­si­tion pa­pers for re­view by busi­ness and ap­pro­pri­ate Gov­ern­ment authorities in ad­di­tion to hold­ing Lec­tures and Sem­i­nars and spon­sor­ing Re­search. In time, PBC ex­pects to be able to broaden its mem­ber­ship and ac­tiv­i­ties, to in­clude Ad­vi­sory and Con­sul­ta­tive ser­vices both to Pak­istani and For­eign In­vestors.

The Pak­istan Busi­ness Coun­cil is a pri­vate sec­tor, not-for-profit, busi­ness ad­vo­cacy group reg­is­tered un­der Sec­tion 42 of the Com­pa­nies Or­di­nance 1984. The group that be­gan work­ing as a 14-mem­ber group has now ex­panded to 32. The PCB fol­lows an “ev­i­dence based” ad­vo­cacy strat­egy re­ly­ing heav­ily on re­gional and in­ter­na­tional best prac­tices.

The ma­jor ob­jec­tives of the PCB as stated in its found­ing doc­u­ment are:

• To pro­vide for the for­ma­tion and ex­change of views on any ques­tion con­nected with the con­duct of busi­nesses in and from Pak­istan.

• To con­duct, or­ga­nize, set-up, ad­min­is­ter and man­age cam­paigns, sur­veys, fo­cus groups, work­shops, sem­i­nars, and field works for car­ry­ing out re­search and rais­ing aware­ness in re­gard to mat­ters af­fect­ing busi­nesses in Pak­istan.

• To ac­quire, col­lect, com­pile, an­a­lyze, pub­lish and pro­vide sta­tis­tics, data anal­y­sis and other in­for­ma­tion re­lat­ing to busi­nesses of any kind, na­ture or de­scrip­tion and on op­por­tu­ni­ties for such busi­nesses within and out­side Pak­istan.

• To pro­mote and fa­cil­i­tate the in­te­gra­tion of busi­nesses in Pak­istan into the World econ­omy and to en­cour­age the de­vel­op­ment and growth of Pak­istani multi­na­tion­als.

• To in­ter­act with Gov­ern­ments in the eco­nomic de­vel­op­ment of Pak­istan and to fa­cil­i­tate, fos­ter and fur­ther the eco­nomic, so­cial and hu­man re­source de­vel­op­ment of Pak­istan. Struc­ture: The PCB Board has 14 mem­bers, thir­teen of whom are elected from the Ex­ec­u­tive Mem­bers of the PBC while the CEO is the 14th mem­ber of the Board. The cur­rent com­po­si­tion of the PCB Board is as fol­lows:

The cur­rent qual­i­fy­ing thresh­old for a non-fi­nan­cial sec­tor com­pany to be a mem­ber of the PBC is to have a paid cap­i­tal of at least Rs. 1.0 bil­lion or fixed as­sets equiv­a­lent to this value. For a fi­nan­cial sec­tor com­pany, the qual­i­fy­ing re­quire­ment is paid-up cap­i­tal of at least Rs. 2.0 bil­lion. Qual­i­fy­ing thresh­olds are for in­di­vid­ual com­pa­nies and group com­pa­nies’ paid-up capita; and group com­pa­nies’ fixed as­sets do not qual­ify. Ad­di­tion­ally, the join­ing fee of Rs. 2.0 mil­lion and an­nual sub­scrip­tion

of Rs. 0.75 mil­lion has been fixed to en­cour­age se­ri­ous par­tic­i­pa­tion.

The PBC cur­rently rep­re­sents 32 of Pak­istan’s largest pri­vate-sec­tor busi­ness groups in­clud­ing multi­na­tion­als, which cover nearly all sec­tors of the for­mal econ­omy. Sec­tor-wise rep­re­sen­ta­tion is as fol­lows:

The Pak­istan Busi­ness Coun­cil’s ef­forts to im­prove the busi­ness cli­mate and its em­pha­sis on im­prov­ing the com­pet­i­tive­ness of large scale man­u­fac­tur­ing in Pak­istan has led to its be­ing rec­og­nized as a premier rep­re­sen­ta­tive body of the pri­vate sec­tor in Pak­istan. For in­stance, the PBC took a strong stance on the mat­ter of RGST and pre­sented valid ar­gu­ments to gather sup­port on the mat­ter. The key points that the think tank pre­sented could be stated as un­der: • RGST forces doc­u­men­ta­tion which will help to

sig­nif­i­cantly re­duce eva­sion. • Raise gov­ern­ment rev­enues - in­creased in­vest­ment in

in­fra­struc­ture/hu­man cap­i­tal • Tax-to-GDP ra­tio (one of the low­est in emerg­ing eco­nom­ics) set to im­prove af­ter RGST. Lead to re­duced cor­po­rate tax rate (high­est in emerg­ing economies) Will pro­vide a level play­ing field to the for­mal sec­tor in­crease FDI and lo­cal in­vest­ment Over­all to im­prove Pak­istan’s com­pet­i­tive­ness (alarm­ing loss in rank­ing) In short, to achieve an ac­cel­er­ated eco­nomic growth rate to im­prove Pak­istan’s global com­pet­i­tive­ness, PBC strongly sup­ported the RGST con­cept.

The al­liance of dif­fer­ent multi­na­tion­als un­der­stands the prob­lems of the coun­try and it has tried to ad­dress is­sues like en­ergy cri­sis, im­prove­ment of pub­lic fi­nance and in­vestors’ plight. Ad­dress­ing the se­vere en­ergy cri­sis the coun­cil had sug­gested: • ac­cel­er­at­ing de­vel­op­ment of theThar Coal pro­ject • re­vamp­ing ob­so­lete power gen­er­a­tion, dis­tri­bu­tion and trans­mis­sion fa­cil­i­ties elim­i­nat­ing pric­ing dis­tor­tions be­tween dif­fer­ent fu­els and sec­tors cre­ated by tax­a­tion ac­cel­er­at­ing gas ex­plo­ration in prospec­tive zones in Balochis­tan and KPK. De­spite the pop­u­lar be­lief that multi­na­tion­als do not favour tax re­forms, PBC’s sup­port of farms and real es­tate could also be pre­sented as an ar­gu­ment to de­fend the neu­tral po­si­tion of PBC. In re­sponse to Fi­nance Min­is­ter Ab­dul Hafeez Shaikh’s re­cent stand re­gard­ing tax re­forms, it has clearly de­clared that the gov­ern­ment, in­clud­ing the pro­vin­cial gov­ern­ments, have to in­crease their tax base by bring­ing taxed sec­tors of the econ­omy into an ef­fec­tive tax net as op­posed to im­pos­ing ad­di­tional tax pay­ers.

The stances that the coun­cil has taken so far re­flect the pos­i­tive en­ergy its mem­bers are pro­mot­ing in the coun­try. It has wit­nessed the strong opin­ions they have held about en­ergy and en­ergy con­ver­sa­tion, tax re­forms, in­tra-re­gional trade and so­cial is­sues such as health and ed­u­ca­tion.

It would be ap­pro­pri­ate to state that the PBC has risen from just be­ing an al­liance of MNCs and safe­guard­ing their con­cerns as na­tional in­tegrity and econ­omy has al­ways been on its pri­or­ity list. The prospects of the suc­cess of such al­liances in­crease if a bal­ance is main­tained be­tween cor­po­rate competition and the gen­eral in­ter­ests of busi­ness cul­ture

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