Karachi, October 30, 2023 – Pakistan is ready to facilitate foreign investment in export based industries, Dr. Shamshad Akhtar, caretaker finance minister said in a meeting with foreign investors.
During a meeting with foreign investors, she encouraged the Overseas Investors Chamber of Commerce and Industry (OICCI) to support the government’s efforts to attract foreign direct investment (FDI) and invest in export-oriented sectors to contribute to the nation’s development and bolster its balance of payments in a sustainable manner.
Dr. Akhtar shared her perspective during her visit to the OICCI, where she was accompanied by Malik Amjed Zubair Tiwana, Chairman of the Federal Board of Revenue (FBR), the Customs and Income Tax Commissioner, and SECP Commissioner Warriach. She provided insights into the country’s recent economic assessment and outlook, highlighting the signs of economic recovery in the initial months of the year.
In her assessment, the agriculture sector shows promise based on crop output results, while the large-scale manufacturing sector exhibits positive growth, although it remains below its potential. FBR collections in the first quarter of the year have been satisfactory, and decisive measures in areas such as the exchange market and controlling theft have restored confidence.
The Finance Minister also mentioned ongoing efforts to launch a state-owned enterprise (SOE) reform policy and enhance corporate governance practices. Dr. Akhtar appreciated the OICCI members’ endeavors to attract foreign investments to Pakistan and reiterated the government’s readiness to assist investors in any way possible.
She shared the key aspects of Pakistan’s economic revival program, emphasizing its focus on sustainable economic recovery through the private sector. In her view, the current global crises necessitate collaboration between the government and the private sector to address the challenges effectively.
During the meeting, the OICCI urged the government to expand the tax base aggressively as a means to boost revenue. Notably, the Chamber emphasized tax evasion of over Rs300 billion in the tobacco sector. OICCI recommended the establishment of an independent private sector group of experts outside the FBR’s purview to enhance tax policy.
Numerous OICCI members, representing large foreign investors, requested a level playing field for compliant taxpayers who already contribute significant tax revenue and have reinvested $22 billion in Pakistan since 2013. They expressed concerns about tax harassment due to unrealistic targets for existing taxpayers and suggested expanding the tax base to include retailers.
The OICCI presented the findings of its recent survey, which recommended measures to stabilize the declining value of the rupee and reduce the overall cost of doing business in Pakistan, making the country more attractive to foreign direct investment.
The Minister and the FBR Chairman addressed specific concerns raised by OICCI members, including high tax rates for corporate entities and salaried individuals, outstanding tax refunds of multinational corporations, simplification of withholding tax rates, and FBR reforms. The meeting also discussed pricing and tax distortions.
Pakistan is actively working to create a conducive environment for foreign investment in export industries, which is expected to contribute to the nation’s economic growth and development.
