Ha­rass­ment of in­dus­tri­al­ists af­fects eco­nomic growth

Pakistan Observer - - ECONOMY WATCH -

AQAM-UD-DIN KHAN BUSI­NESS in Pak­istan suf­fers from a num­ber of prob­lems. It is a good move, how­ever, on the part of the Na­tional Ac­count­abil­ity Bureau (NAB) and the gov­ern­ment that due no­tice is be­ing taken of the cor­rupt prac­tices that have been fol­lowed by to amass wealth through ne­far­i­ous means. A re­cent ex­am­ple is that of the Rs730 mil­lion that was re­cov­ered from the res­i­dence of Balochis­tan Fi­nance Sec­re­tary Mush­taq Ahmed Raisani, who was also ar­rested. Cor­rup­tion is neg­a­tively af­fect­ing the eco­nomic sit­u­a­tion, the coun­try is suf­fer­ing and for­eign in­vestors are turn­ing away. Prime Min­is­ter Nawaz Sharif and the Chief Min­is­ter of Pun­jab, Shabaz Sharif are tak­ing mea­sures to im­prove the coun­try’s eco­nomic cli­mate.

Eco­nomic growth is in­her­ently linked to a na­tion’s pro­duc­tion out­put. In Pak­istan be­cause high pro­duc­tion lev­els are not achieved due to the paucity of en­ergy for fac­to­ries and pro­duc­tion units. Fac­to­ries suf­fer be­cause of the load-shed­ding sched­ules and pro­duc­tion is not achieved at full ca­pac­ity. This in turn af­fects na­tional ex­ports which go into a de­cline be­cause pro­duc­tion and de­liv­ery time­lines are not met. As a re­sult, Pak­istan’s ex­ports in­stead of reg­is­ter­ing a con­tin­u­ous growth pat­tern have fallen be­hind and the coun­try is not achiev­ing its tar­gets.

Ex­ports are the life­line of na­tional growth and a barom­e­ter of eco­nomic health, There­fore, de­clin­ing ex­ports are very bad news. It was af­ter much en­deav­our that Pak­istan won the G-Plus sta­tus for ex­ports to EU coun­tries but that seems to be go­ing down the drain. Plum­met­ing eco­nomic growth also leads to un­em­ploy­ment and cre­ates a fur­ther deep dent in the over­all eco­nomic and so­cial in­di­ca­tors.

An­other fac­tor which is fast emerg­ing and is cre­at­ing prob­lems for in­dus­try and busi­ness in Pak­istan is ha­rass­ment. There was a time when the busi­ness com­mu­nity was un­nec­es­sar­ily pestered by the tax wolves with the re­sult that a good part of the rev­enue did not en­ter the na­tional ex­che­quer; in­stead, it was fun­neled into the pock­ets of tax men and their agents. Then came a time when busi­ness­men were ha­rassed by ter­ror­ists and ex­tor­tion­ists of all shades and hues. Things reached a point when they ei­ther paid up the ex­tor­tion money or were kid­napped for ran­som. The trend gave way to ‘parchies’ furtively land­ing at shops, small trader es­tab­lish­ments and fac­to­ries, ask­ing for ‘bhatta’ or ex­tor­tion money. The trend was pick­ing up speed, es­pe­cially in a rev­enue-gen­er­at­ing city like Karachi, when the Rangers stepped in and put an end to the trend.

How­ever, busi­ness­men still con­tinue to suf­fer from an­other sorry de­vel­op­ment. It per­tains to the in­cli­na­tion among cer­tain un­scrupu­lous el­e­ments in law en­forcers. These ex­tor­tion­ists need to know how their ac­tiv­i­ties are hurt­ing the coun­try’s de­vel­op­ment. In one such in­ci­dent, a serv­ing police of­fi­cial threat­ened an in­dus­tri­al­ist of dire con­se­quences if he did not pay up a cer­tain amount to an­other in­dus­tri­al­ist. The ra­tio­nale of the police of­fi­cer’s med­dling in the dis­pute was that he de­scribed him­self as a ‘part­ner’ in the busi­ness. How a gov­ern­ment of­fi­cial could be a part­ner in busi­ness was a big ques­tion mark.

We are fac­ing a big chal­lenge by com­pet­ing with re­gional economies like China and In­dia and emerg­ing economies like Viet­nam. They have pro­grams for the pro­mo­tion of their. We can learn from In­dia. In­dia sup­ports in­dus­trial. The point is that to­day our tex­tile in­dus­try and var­i­ous other in­dus­tries like the rice in­dus­try are fac­ing re­gional eco­nomic com­pe­ti­tion which we are un­able to re­spond to. The in­dus­tri­al­ist wants a very fo­cused, sup­port­ive and peace­ful en­vi­ron­ment so that he can be in­no­va­tive and come up with so­lu­tions.

This kind of pres­sure is fur­ther com­pounded by the ha­rass­ment is­sue and it tips the scales. It is not at all some­thing that the busi­ness com­mu­nity can deal with. The coun­try can­not af­ford to ha­rass its busi­ness­men and ex­pect the econ­omy to thrive. The gov­ern­ment alone can­not be ex­pected to find a so­lu­tion to this prob­lem. The only thing is that if, on top of their fi­nan­cial chal­lenges, the busi­ness­men start feel­ing per­son­ally threat­ened, they will hardly be able to pur­sue their work on an in­no­va­tive ba­sis and look for busi­ness op­por­tu­ni­ties else­where.

Pak­istan is also faced with debt pay­ments which favour a strong cur­rency while international ex­port com­pe­ti­tion favours a weaker cur­rency. If we weaken our cur­rency, we face prob­lems in mak­ing pay­ments which is the ma­jor dilemma of our fi­nance min­istry. If we do not ad­dress the cur­rency is­sue, we lose share in international mar­kets. This may not af­fect the bal­ance sheet of the gov­ern­ment be­cause they are get­ting re­mit­tances and ev­ery­thing is be­ing cov­ered but, in the longterm, we will crip­ple our econ­omy with dire reper­cus­sions. If the is­sue of ha­rass­ment of busi­ness­men is solved, the busi­ness com­mu­nity can at least work in a peace­ful en­vi­ron­ment and face the re­gional economies. The gov­ern­ment is tak­ing many mea­sures to im­prove the econ­omy and the NAB ini­tia­tives are also com­mend­able. As such, there is still hope if we keep mov­ing in the right di­rec­tion. It needs to be un­der­stood by the pow­ers that our busi­ness­men are in very dis­ad­van­taged and frus­trat­ing po­si­tion, which is rat­ter alarm­ing. The gov­ern­ment needs to take no­tice of this fact if it wants the econ­omy to grow.

Newspapers in English

Newspapers from Pakistan

© PressReader. All rights reserved.