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Expressing concerns over slow economic growth and increasing fiscal deficit, the Lahore Chamber of Commerce and Industry has said that the country’s economy is at a high risk and remains vulnerable to internal and external shocks.
In a statement issued on Saturday the LCCI President Farooq Iftikhar said that the continuous increase in fiscal deficit will pull country’s economy towards major downturn, which is already in precarious condition due to various core issues that need to be addressed on urgent basis.
He, however, said that the two main reasons for increase in the deficit is inability to control expenditures and lack of a plan to generate higher revenue in view of severe energy crisis.
The LCCI President suggested to the government to lower the interest rates as lowering by a single point saves Rs 100 billion for the government as major chunk of the government borrowing is from domestic means.
He further added that loss making Public Sector Enterprises (PSEs) are damaging the economy by Rs 500 billion per annum but government could save Rs 200 billion by applying good governance practices in PSEs for the time being. We request the federal government to take prudent decisions without wasting further time in the larger interest of the country.
The current account deficit could also be reduced by at least Rs 300 billion by maintaining and regulating public spending and pursuing a sound fiscal policy.
Farooq Iftikhar said that fiscal deficit could also be lowered by increasing the Government revenue for which effective measures were needed to expand the tax base by bringing all sectors under tax net.
He said that there is no doubt that the situation is compounded by an uncertain global environment and a difficult domestic situation but it is also extremely important that all economic policies in vogue at the moment be reviewed afresh in totality.