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  • PLGMEA disowns FPCCI advertisement

    PLGMEA disowns FPCCI advertisement

    KARACHI: Pakistan Leather Garments Manufacturers and Exporters Association (PLGMEA) on Tuesday disowned itself from an advertisement issued by the country’s apex trade body.

    PLGMEA Chairman Danish Khan has strongly condemned the advertisement by the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), and said that the apex trade body had used the name without the permission.

    PLGMEA has nothing to do with the advertisement and no such opinion. “We are free to express our position without using the platform of FPCCI,” he said.

    The FPCCI has acted unethically by using the name of the Leather Garments Association members without the permission of PLGMEA.

    He said that the Federation of Pakistan Chambers of Commerce is the apex body of the business community and such high-handed tactics do not beautify such a credible institution. Such measures have tarnished the image of the institution.

    Danish Khan said that PLGMEA was not part of the advertisement and the position presented in it was personal to the FPCCI.

    Chairman PLGMEA demanded FPCCI to apologize from PLGMEA for their biased advertisement and refrain from taking such steps in future. PLGMEA reserved the right to take legal action on such issues.

  • FPCCI urges tax rate cut in budget to mitigate coronavirus losses

    FPCCI urges tax rate cut in budget to mitigate coronavirus losses

    KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on Monday sought sizeable cut in tax rates in upcoming budget 2021/2022 to mitigate industrial losses due to coronavirus.

    FPCCI’s Businessmen Panel Chairman Mian Anjum Nisar, in a statement, said that the government will have to make visible reduction in taxes in the budget 2021-22 to help revive the businesses in post-corona economic strategy.

    He recommended the government to take serious steps for bringing down cost of production, which is very high due to local currency depreciation, rising power tariffs, costly fuel and escalating import duties on inputs.

    While talking to a traders delegation here on Monday, Mian Anjum Nisar, who is also former president of FPCCI, said that like the domestic industry Covid-19 crisis has also forced the global investors to put their new investment plans on hold. He said that there is no visible improvement in employment even after the business activities were allowed and countrywide lockdown eased. The small and medium industries (SMEs) -the main providers of jobs are still struggling because of lack of funds and demand.

    Mian Anjum Nisar asked the government to take concrete steps to attract foreign investment, saving the livelihood of millions of workers associated with various sectors, as Foreign direct investment (FDI) has kept falling during the current fiscal, declining by 35 percent at the end of the third quarter, reflecting no improvement in the situation for investors.

    Quoting the SBP data, he said that the FDI fell by 35% to $1.39 billion during July-March FY21 compared to $2.15 billion in the same period of last fiscal. The inflow in March was just $167.6 million compared to $278.7m in the same month of last year — a decline of 40%.

    While the poor inflows of FDI have continued for more than five years, the government remained unable to offer anything new to attract foreign investors this year, mainly due to the coronavirus pandemic.

    Pakistan has reopened its economy from the lockdown. Majority of the sectors in manufacturing and almost entire agriculture sector are operational now. He said that foreign direct investment figures of the previous year reflected the same poor scenario.

    The BMP Chief said that Pakistan has succeeded to improve its balance of payments with record remittances in FY20. He said that Pakistan can be a potential market for foreign investors, who still have plans to make fresh investment in the country, but they have continued to wait for the return of economic stability. He highlighted uncertainty in the rupee-dollar parity as one of the major concerns of foreign investors.

    He said a slowdown in the economy had badly impacted business confidence. It is must for the authorities concerned to first create an enabling environment for the local businessmen desiring to make new investment. He said that the return of stability to the financial health of the firms is a must to attract new foreign investment in Pakistan.

    Resenting frequent increase in power tariff the FPCCI former president strongly opposed the government plan of increasing base electricity tariff across the country by a cumulative Rs5.36 per unit in three phases over the next two years.

    Mian Anjum Nisar said the constant increases in energy rates on the behest of the International Monetary Fund would make the Pakistani products uncompetitive in the international market.

    He said the regular attempt of economic managers to increase oil prices along with the hike in power and gas tariffs will ultimately harm the government’s overall move of reducing the production cost in the country announced by the prime minister in various phases.

    Mian Anjum Nisar said it was imperative to make power and gas tariffs for domestic, as well as export sectors compatible with the tariff being applied in regional and neighbouring countries.

    He said that with a view to save the economy from the impacts of the slowdown due to the COVID-19 the government should offer out of the box solution for a cash-strapped SMEs, which represents more than 90 percent of around 3.2 million business enterprises in Pakistan, contributing 40 percent to the GDP, employing more than 80 percent of non-agricultural workforce, and generating 25 percent of export earnings.

  • FPCCI urges tax authorities to facilitate edible oil manufacturers

    FPCCI urges tax authorities to facilitate edible oil manufacturers

    KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has urged the tax authorities to facilitate edible oil manufacturers by excluding from a notification related to commercial importers.

    According to a statement issued on Saturday FPCCI Vice President Nasir Khan strongly condemned the inclusion of Edible Oils in the S.R.O. 1190(I)/2019 issued by the Federal Board of Revenue (FBR).

    As a matter of principle, this SRO should have been restricted to commercial importers instead of including edible oil manufacturers. Therefore, one of the major disruptions this SRO has caused is that edible oil manufacturers have massively decreased their imports and major imports have been taken over by the commercial importers.

    Nasir Khan has noted that this notification/SRO has resulted in a straight 10 percent increase in the cost of importing edible oils in the country. Contrarily, during the same period, India and Bangladesh have reduced the cost of importing edible oils in their countries by 10 percent and 4 percent through providing various relief measures to edible oil manufacturers.

    Moreover, Nasir Khan has said that instead of providing billions of rupees to Utility Stores Corporation (USC) to sell subsidized edible oils, the federal government should facilitate edible oil manufacturers. In that manner, they will be able to cut down the edible oil prices; and, provide better and greater relief to consumers in the entire country than the USC could ever achieve. This illogical and illegal inclusion has caused more than 10 percent increase in edible oil prices due to hoarding by commercial importers.

    FPCCI demands immediate withdrawal of inclusion of edible oil manufacturers from above-mentioned SRO to help edible oil manufacturers to avoid bankruptcy and continue to play their role in economic growth and employment generation.

  • FPCCI expresses concerns over approval to RLNG power plant

    FPCCI expresses concerns over approval to RLNG power plant

    KARACHI: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on Tuesday voiced strong concerns regarding the federal government’s approval of a 1263MW power plant to be run on imported RLNG. This plant, being developed by Punjab Thermal Power Ltd in Jhang, has sparked significant debate over its economic and environmental implications.

    (more…)
  • FPCCI demands only three Eid holidays

    FPCCI demands only three Eid holidays

    KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on Monday demanded the government of reducing Eid holidays to three to avoid business and economic losses.

    The apex trade body expressed displeasure over yet another set of SOPs and Public Holidays on account of Eid-Ul-Fitr announced by NCOC without consulting business, industrial, and trade community of Pakistan. 

    Mian Nasser Hyatt Maggo, President FPCCI, has demanded that industries and markets should only be closed for 3 days on account of Eid-Ul-Fitr; otherwise, there will be irreversible loss to already struggling businesses and huge shortfall in tax collection will further decelerate the economic activity.

     Mian Nasser Hyatt Maggo maintained that ports, customs, and required banking services for them should not even be closed for 3 days during Eid-Ul-Fitr; as exports are as necessary for survival of Pakistan as airports and hospitals. Even a single day closure of ports during Eid will add to existing huge glut and backlog for exporters and cause financial and goodwill loss for not being able to ship the consignments on agreed schedules. He demanded that ports timings should be extended to 05:00 PM with immediate effect.  

    Mian Nasser Hyatt Maggo, also expressed his shock over proposed Eid Holidays from 10-15 May, where ports, customs, and banks will remain closed and shipping lines will keep operating.

    This is utterly illogical as without ports, customs, and banks, there will be no use of shipping lines operating.

  • FPCCI urges following coronavirus SOPs to avert industrial halt

    FPCCI urges following coronavirus SOPs to avert industrial halt

    KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on Saturday urged trade and industry to follow SOPs related to coronavirus in order to avert complete halt of industrial and economic activities.

    FPCCI’s ruling group BMP Chairman Mian Anjum Nisar has asked the traders to strictly follow the government’s SOPs in markets for curbing the spread of deadly coronavirus and averting halt of the industrial wheel.

    Moreover, there is also need to speed up vaccination process, especially for the industry workers in the country, for the smooth operation of trade and industry, he added.

    “The businessmen themselves have to ensure a strict implementation of the standard operating procedures in markets and commercial areas in order to curb the spread of Covid-19 pandemic,” he said and warned that the third wave of coronavirus had spread to dangerous levels and the situation demanded that the business community play a role in strict compliance with the SOPs in business areas to control further Covid-19 infections.

    Mian Anjum Nisar stressed that a reduction in coronavirus cases would help the government to consider easing restrictions on businesses, as it would cause great losses to trade activities, render thousands of daily-wage workers and other workers jobless, making the lives more miserable, fuel a further increase in inflation besides badly impacting the economy.

    He said that during the third wave of coronavirus the situation has been deteriorating mainly due to lack of implementation of COVID-19 standard operating procedures and the solution lies in speeding up our vaccination programs, instead of opting for closure of trade and industry amidst GDP growth of just 1.5 percent. He said that in view of combating the coronavirus situation the government can impose smart lockdown where required, as complete lockdown would halt industry.

    The FPCCI former president pointed out that due to the previous lockdowns, Pakistan’s economy had suffered a loss of billions of dollars while millions of workers lost their jobs. Pakistan’s economy suffered negative growth last fiscal year for the first time in the history due to Covid-19, he said, adding that the best way to save the economy and businesses from more losses is to follow the SOPs.

    He observed that the complete lockdowns had created havoc globally, as the countries, which were providing loans had also came under debts while Pakistan is already facing financial crunch due to huge burden of debts. So, complete lockdown is not a good option, he added.

    He observed that the government will have to make visible reduction in taxes in the budget to help revive the businesses, which are near to bankruptcies owing to slowdown amidst coronavirus.

    He asked the government to take concrete steps to attract foreign investment, saving the livelihood of millions of workers associated with various sectors, as foreign investment in Pakistan’s long-term projects like power plants and oil and gas exploration.

    The BMP Chairman said that with a view to save the economy from the impacts of the slowdown due to the COVID-19 the government should announce special incentives for a cash-strapped SMEs, which represents more than 90 percent of around 3.2 million business enterprises in Pakistan, contributing 40 percent to the GDP, employing more than 80 percent of non-agricultural workforce, and generating 25 percent of export earnings.

    He expressed dissatisfaction over the financial packages by the government for the businesses to deal with the financial crunch, called for a significant cut in import duties and waiver of sales tax, income tax and additional income taxes, for the smooth running of trade and industry.

    He asked the government to expedite the process of vaccination and supply ample quantity of doses not only to the whole public but also to the trade and industry.

    Mian Anjum Nisar said that rising mortality in the midst of the third Covid-19 wave and growing anxiety in the business circles over possible restrictions on international travel and trade necessitate ramping up the pace of vaccination.

    To speed up inoculations, the government will need to bridge vaccine supply gaps with active participation from the federating units and the private sector, he added.

  • Shaukat Tarin assures FPCCI of taking on board before making economic decisions

    Shaukat Tarin assures FPCCI of taking on board before making economic decisions

    ISLAMABAD: Finance Minister Shukat Tarin on Friday assured the representatives of Federation of Pakistan Chambers of Commerce and Industry (FPCCI) to have a regular interaction.

    He also affirmed that all key stakeholders would be taken on board before making important economic decisions.

    The finance minister held a meeting with the FPCCI members through a video link. Adviser to the PM on Commerce Abdul Razak Dawood, SAPM on Finance and Revenue Dr. Waqar Masood, Chairman FBR and other senior officers participated in the meeting.

    While addressing the meeting, the Finance Minister briefed the participants about the economic priorities of the Government.

    He also outlined that the Government is adhering to strict financial discipline for achieving macro-economic stability and enhancing revenue generation.

    The Minister also outlined that Pakistan’s economy is showing signs of recovery amid Coronavirus pandemic, with construction and manufacturing sectors in lead. However, the third wave of COVID-19 is particularly challenging, he added.

    The Minister also stressed the role of Chambers of Commerce and Industry as a bridge between the Government and the traders for active coordination and welcomed suggestions from the members of FPCCI on the occasion.

    The representatives of FPCCI felicitated the Finance Minister on assuming new responsibilities and discussed the matters related to sales tax harmonization and rationalization of taxes.

    In his concluding remarks, the Finance Minister stated that the suggestions presented during the meeting would be accorded due consideration.

  • Tax exemption withdrawal ahead budget to adversely affect trade, industry

    Tax exemption withdrawal ahead budget to adversely affect trade, industry

    KARACHI: The apex trade body of the country has expressed reservations over withdrawal of tax exemptions ahead of federal budget 2021/2022 and said that it will adversely affect trade and industry.

    Mian Nasser Hyatt Maggo, President of Federation of Pakistan Chambers of Commerce and industry (FPCCI) in a statement on Sunday said that under the prevalent difficult condition of COVID-19, the pre-budget withdrawal of number of exemptions will affect trade and industry negatively, which is based on planning of fiscal based promised position for year up to June-2021.

    “Such non predictability is against the sustainable growth of business economy and encroaches upon ease of doing business,” he said.

    He was referring to the Tax Laws (Second Amendment) Ordinance, 2021 dated March 24, 2021.

    While expressing concerns over the amendments before budget, he said that FPCCI has already suggested that the amendment should be made only with prior consultations with, to be affected stakeholders with sufficient time space to prepare the future plan of the left out period up to June-2021.

    The outcome of consultations of both public and private sector may have otherwise trimmed the contents of the ordinance in the business economy interest, equally important for government in terms of goodwill and believe in consultations with private sector.

    He further said that the business sector is already facing tight restrictions as per IMF program conditionality, much being agreed amongst stakeholders as originating implementation directions concurred by public sector without any reference to the negotiations with private sector.

    The amendments were introduced through the Tax Laws Amendment Ordinance, 2021 issued through presidential Ordinance to amend 76 corporate income tax exemptions and allow tax credit facility from March 24, 2021.

    The tax credit facility has been extended to industrial undertakings; charitable organizations and IT export services. Under the Ordinance, 100 percent tax credit would be allowed to the IT services or IT-enabled services after fulfillment of certain conditions including the filing of returns/withholding tax statements.

    President FPCCI further stated that withdrawal of exemptions in lieu of extending credit facilities is a measure which gauges the poor performance of FBR up till now and hence the collection targets are finding the only priority and it appears that FBR is running on a bad doctrine that more tax collection will improve the growth of economy, to which we disagree in absolute terms.

    President FPCCI Mian Nasser Hyatt Maggo also said that the newly promulgated Ordinance 2021 is also limiting the charitable activities by allowing restricted number of such institutions and placed them under newly introduced 13th schedule for Section 61 of the Income Tax Ordinance.

    President FPCCI said that we are not following the successful tax models which are based on reducing the tax rates and extending the facilities to be affecting the increase in tax collections, rightly agreed by the apex body that Laffer curve will result in maximum tax revenue for government by cutting taxes in certain circumstances that would allow governments to cut the taxes and simultaneously increase revenue and economic growth.

    President FPCCI said that public sector negotiating with IMF in exclusion of participation of apex body representing private sector trade, industry and service sector is dictatorial impositions of decisions negatively affecting the business and its growth for reducing the fiscal deficits, a prime objective we believe is being asked for by IMF.

    He further said that country like US during the period of Ronald Reagan, 40th US President, the tax cuts resulted in doubling the tax from USD 500 Billion to Dollar 01 Trillion. The Georgian politicians and businessmen together in the reforms reduce the number of taxes to 1/3rd and reduce the national tax burden to quarter of a GDP resulted in doubling the percentage of taxes from 13 percent to 25 percent of GDP.

    He further said that the case of India is no exemption wherein single GST increase the GST registrations by almost 100 percent.

    “We are not learning any lesson from the available examples of tax reforms and what we are marching towards is to hide our inefficiencies in tax administration by withdrawing the exemptions, imposing RDs, ACDs and taking all the measures which has made the whole taxation structure full of the anomalies,” he said, adding that the government should think about that if either the economy will generate taxes or imposition of increase in taxes will generate growth of the economy.

  • FPCCI hails speedy customs clearance

    FPCCI hails speedy customs clearance

    KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on Wednesday hailed the tax authorities for speedy customs clearance to goods imported by erstwhile FATA/PATA.

    Mian Nasser Hyatt Maggo, President and Nasir Khan Vice President of the FPCCI appreciated the FBR for its efforts to improve ease of doing business and trade facilitation by allowing clearance of goods imported by ERSTWHIL FATA/PATA and installations of tracking devices manually to ensure en-route monitoring and tracking till the development of the functionality in the WEBOC system.

    They further informed that under this FBR directives the processing of such consignments may be cleared in the system by the respective Collectorate after implementation of the required conditions as prescribed in the CGO and Board instructions.

    M/s. TPL Trakker (Pvt.) Ltd. has been assigned for manually installation of tracking devices for consignments.

    Control mechanism for clearance of such consignments will remains with the Collectorate while it may get the written confirmation for concerned clearing agents/bonded carriers.

    While referring FBR’s Order issued on March 17, 2021 they said that FPCCI have been emphasizing for development of economically deprived regions through enhancement of transit trade by improving trade facilitations.

    They further added that the global economic scenario has drastically changed, e-commerce and digitalization has gained significance for international trade therefore, FBR and other stakeholders should also follow and improve their working according to the new technological development in trade.

  • FPCCI expresses concerns over falling foreign direct investment

    FPCCI expresses concerns over falling foreign direct investment

    KARACHI: Federation of Pakistan Chamber of Commerce and Industry (FPCCI) has expressed concerns over falling foreign direct investment (FDI) despite incentives granted to foreign investors.

    In a statement issued on Saturday, the apex trade body expressed serious concern over the falling trend of foreign direct investment. The FDI fell by 30 percent in the first eight months of FY21, reflecting foreign investors’ poor confidence in the country’s investment environment.

    The government has been claiming to endeavor to invite foreign investment in the housing sector but failed to make the sector attractive in this regard. Investment in construction industry has improved at local level but the sector has huge prospects for foreign investors, as the country has been lacking more than 10 million housing units for its 220 million people, observed Mian Anjum Nisar, the FPCCI’s ruling group BMP Chairman.

    “We need to prepare the ground for attracting larger FDI flows in the medium and long-terms, making the local environment more attractive for foreign investors. Pakistan should continue to get some FDI under the China-Pakistan Economic Corridor (CPEC) and even accelerate its inflows by gaining wider domestic socio-political support for CPEC projects and by removing procedural bottlenecks that delay their timely implementation,” he added.

    He said that faced with a balance-of-payments issue, country urgently needed as much foreign investment as possible keeping in view of limited scope of volumetric expansion in exports and remittances in the short-term.

    Mian Anjum Nisar said that Pakistan has been unable to attract any sizeable foreign investment for the last several years despite providing incentives on taxes and assurances for one-window facility to the investors.

    Statistics show that the country received $1.3 billion in FDI during July-Feb 2020-21 compared to $1.85 billion in the same period of last year, a decline of 29.9%, indicating that the government has failed to win the confidence of foreign investors in the national economy due to multiple reasons. Moreover, the inflow of FDI in February has registered a steep fall of 44% to $155 million against inflow of $277.5 million in Feb 2020. It is fact that the entire world has been witnessing falling inflows of FDI due to the Covid-19 pandemic.

    “The pandemic has eroded the trust of investors in investment, which has an adverse impact on every step of FDI, including input supplies, increasing uncertainties and liquidity constraints for the multinational firms, he said and added there are also other external factors out of the government’s control.”

    It is unfortunate that the portfolio investment also presented a dark picture as it noted a net outflow of $256 million during 8MFY21 compared to an outflow of $26.3m in the same period last year.

    The State Bank of Pakistan (SBP) data showed that the overall foreign private investment during 8MFY21 dropped by 43% to $1.04 billion compared to $1.83 billion in the same period last year.

    The BMP chairman said that the Chinese investment remained at the top of the list of countries invested in Pakistan but the inflows from Beijing also dropped to $493 million during 8MFY21 despite the fact that for last several years China has been the top investor in the country.

    While the country is getting extra support from remittances being sent by the overseas Pakistanis, it looks still hard to improve the foreign investments and exports to any significant level.

    The FPCCI leader said despite all-out efforts and incentives, exports grew slowly while foreign investment could see a change once the country exited the FATF grey list. The status quo for international investment for Pakistan has always focused on coal and power but the government should tap into the small, growing sectors, such as technology, to see how it can build a more sustainable economic base, even in times of crisis.

    Mian Anjum Nisar observed that the government, now in its third year, is trying to take FDI to new heights but its efforts are yielding a moderate success only, as the foreign portfolio investment in equities, too, remained negative in 2018-19 and 2019-20 in continuation of an earlier trend.

    The FPCCI former chief said that economic fundamentals are not strong and fast-changing dynamics of geopolitics demand too much from the country if it wants to attain sustainable economic growth and development. These two factors, combined with the Covid-19–triggered recession in major economies, make it difficult to accelerate growth of foreign investment.