International credit rating agency Moody’s has upgraded Pakistan’s debt rating from CAA-3 to CAA-2, the report shows that there are signs of improvement in Pakistan’s economy. According to the report, Pakistan’s capacity for foreign payments is improving. On the other hand, Prime Minister Muhammad Shahbaz Sharif expressed his satisfaction on the upgrade of Pakistan’s credit rating by Moody’s and said that the efforts of the economic team are paying off, now the economy is heading towards growth after stabilization.
It is gratifying that the positive effects of the current government’s economic policies have started to show. In fact, improving Pakistan’s economic situation is a complex issue that requires a multi-pronged strategy. Pakistan is facing challenges like population growth, inflation, unemployment. We have to focus on increasing exports and getting foreign direct investment to balance imports and exports.
Pakistan needs to attract foreign investors by offering tax exemptions, tariff reductions and better regulations, laws and other incentives. Ease of doing business must be made, this strategy will attract more investors. Pakistan needs to improve its economic infrastructure and infrastructure, including transportation networks, power generation and telecommunications. This will increase economic activity and productivity.
Pakistan should focus on developing its export industries, textiles, agriculture and pharmaceuticals. This will require investment in technology, research and development and marketing. Pakistan is located in such an important location where it has the potential to become a hub of trade in the region. The government should work to improve regional integration by building closer ties with neighboring countries and promoting cross-border trade. Pakistan’s current account deficit is a major challenge.
The government should focus on reducing imports by promoting domestic production and developing local industries. This can help reduce the country’s dependence on imports and improve the balance of payments. Overall, improving Pakistan’s economic situation will require sustained efforts by the government and the private sector to address the underlying infrastructural issues that are holding back economic growth.
Although the signs of improvement in the economy are encouraging, the poor and the middle class of the country are groaning under the burden of inflation and these direct taxes. Expensive energy is a major obstacle to the growth of industry, so there is an urgent need to reassess economic policies.
The business community of Pakistan is protesting against the government’s business-friendly scheme. Undoubtedly, the business class has the right to record their protest, but it is also a fact that all the wealthy classes of Pakistan should play their role in the country’s economy fully by paying their share of taxes. After all, why traders don’t want to come in the tax net, the answer to this question needs to be found. The traders who earn crores of rupees under the guise of small shopkeepers are trying to stay out of the tax net.
Pakistan’s retail industry has been on the path of growth for the past few years, setting one milestone after another. FBR should bring new sectors into tax net instead of taxing existing business class more than already in tax net. There is a need to control the rising cost of doing business in the country. Subsidy is also a big problem for us. It should be targeted only. We have to stop the practice of giving subsidies because the subsidy goes into the pockets of the middlemen. Tax after tax will further damage the economy and destroy businesses.
Government should focus on the factor that all transactions should be done through banking channel. Through banking transactions, the government can easily assess direct taxes, indirect taxes affect the poor more, if taxpayers are treated well, roads are made easier for them, then they are big. They can support tax collectors in their pursuit of a greater destination, but difficult paths lead travelers to a Turkish journey.
Central Asian states including Iran and Russia are at our doorstep, if we want to stand our economy on our own feet, we must take a close look at the imports from these countries and especially those that come from distant countries. So if we make what we can of them and they also meet international standards, there is no reason why cheap goods of good quality with cheap labor and rent savings cannot be bought from us. At present more than four hundred textile industries are working. There is a need to keep the textile sector competitive and to further improve the sector as it contributes significantly to the total exports of Pakistan. The government should play a role in finding markets for Pakistani textile exports internationally.
Apart from this, Pakistan needs to take better measures for cotton cultivation along with upgrading the agricultural economy and providing facilities to the farmers. All major textile brands of the world are manufactured in Pakistan but no industrial policy can be successful unless uninterrupted supply of electricity and gas at competitive rates, modern industrial infrastructure and communication network, skilled, experienced Workers, modern banking, friendly tax system are not found. Along with all these steps, it would be good if some concrete steps are also taken to reactivate institutions like Pakistan Industrial Development Corporation established in the past for industrial and economic development.
The overall impression of a country should be good as this is the basis of industrial growth, then people will come forward in industry and investment. There are many industries in Pakistan which, if given facilities and support, are capable of producing locally the products that we are importing. If we start thinking in this aspect, the economy of Pakistan It will be on the right path.
The salaried section of the society plays the backbone role in developing the economy and the market, while successive direct and indirect taxes are making it impossible for the salaried section to meet their basic needs. Also, instead of levying super tax or extra tax on industrialists, they should be encouraged to freely spend on welfare through CSR model. On the other hand, tax reforms are also very much needed.
There are many industrial establishments in Pakistan which, if given facilities and support, are capable of producing locally the products which we are wasting valuable foreign exchange by importing. With the process of privatization under public-private partnership and transparent procedure, we can move in the right direction towards achieving the goals of industrial development. At present, Pakistan’s tax collection is the lowest among the SAARC countries. We should speed up the process of revitalization of industrial enterprises through public-private partnership or privatization.
In order to make the tax culture acceptable and common understanding in Pakistan, it is necessary to respect and honor the taxpayer, give him priority as in developed countries, provide him with facilities in government and public places. When a tax payer is not accorded extraordinary respect, on the contrary, it is humiliated, then a new person will be afraid to join the tax net. We need to build a national consensus on the economic development agenda.
Government institutions should play a positive role in creating a business-friendly environment and they should have regular necessary training in this regard so that they can play a positive role in promoting business instead of creating obstacles. The role of our bureaucracy is advisory and not authoritarian, so there is a great need to adapt the traditional bureaucracy to the 21st century.
