All Pakistan Chambers Conference warns of industrial collapse, seeks urgent energy, tax and export reforms

By Commerce Reporter

LAHORE President Lahore Chamber of Commerce and Industry Fahim ur Rehman Sehgal has warned that the cost of doing business in Pakistan has reached an unsustainable level, forcing industries to relocate abroad, and urged the government to announce immediate relief measures to protect the industrial base.

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Addressing the All Pakistan Chambers Conference, Fahim ur Rehman Sehgal said that a high policy rate, expensive electricity and gas tariffs, and rising cost of finance were crippling local industries. He stressed that unless urgent corrective steps were taken, Pakistan would continue to lose industries, investment and jobs.

The LCCI president demanded a forensic audit of Independent Power Producers (IPPs) agreements to rationalise electricity prices and bring them at par with regional countries. He also called for restoration of the final tax regime for exporters and timely payment of duty drawbacks to enhance export competitiveness.

Highlighting taxation issues, Sehgal said non-filers should be incentivised to enter the tax net while existing taxpayers must be facilitated. He urged simplification and transparency of the tax system and demanded the abolition of unnecessary withholding taxes, which he said were discouraging formal economic activity.

He pointed out that Pakistan was facing a growing trade deficit and investment levels had fallen to a 25-year low. He added that state-owned enterprises were incurring annual losses of around Rs850 billion, calling for immediate privatisation to ease pressure on the national exchequer.

The LCCI president also stressed the need for collateral-free, cash flow-based financing for small and medium enterprises to boost employment and exports.

The conference was attended by Senior Vice President LCCI Tanveer Ahmed Sheikh, Vice President Khurram Lodhi, Saarc Chamber Vice President Mian Anjum Nisar, former LCCI president Muhammad Ali Mian, executive committee members, and presidents and representatives of chambers of commerce from across the country.

Karachi Chamber of Commerce and Industry President Rehan Hanif highlighted misuse of the Export Facilitation Scheme, claiming that the ghee and cooking oil sector alone had caused losses of nearly Rs500 billion.

Islamabad Chamber of Commerce and Industry President Sardar Tahir Mahmood said the business community was passing through a difficult phase due to harsh actions by the Federal Board of Revenue. He warned that industries were shifting out of Pakistan and stressed that the country could not be run without the business community.

Faisalabad Chamber President Farooq Yousaf Sheikh said Faisalabad contributed the highest share of exports, yet nearly 50 percent of its industries had shut down. He questioned how exports could grow when refunds were delayed up to 90 days.

Sialkot Chamber President Syed Ehtesham demanded immediate restoration of the final tax regime and opposed the closure of the Export Facilitation Scheme, terming it vital for small industries.

Gujranwala Chamber President Ali Yasmin Butt said Pakistan lacked a clear tax policy, criticised the Export Facilitation Scheme, and questioned the unfair distribution of Export Development Fund resources.

Chaman Chamber President Abdul Nafee raised concerns over border insecurity and trade disruptions with Afghanistan, while Quetta Chamber President Muhammad Ayub Mirani said exports to Central Asia through Afghanistan had come to a halt despite extensive border fencing.

Multan Chamber President Bakhtawar Tanvir Sheikh questioned whether the country wanted to promote industry and agriculture or continue IMF-driven policies, citing high utility tariffs and markup rates as barriers to new businesses.

Other speakers stressed the need for industry-academia linkage, a long-term charter of economy, improved government-business engagement, and revival of research culture to ensure sustainable economic growth.