Finance Minister urged to take immediate positive measures to maintain exports
Karachi, April 11, 2014 (PPI-OT): The Union of Small and Medium Enterprises (UNISAME) has invited the attention of the federal finance minister (FM) Ishaq Dar to the appreciation of the rupee and informed him that the business community is as such happy at the strengthening of the rupee but desires that the government simultaneously announce a system of bonus against exports in the form of subsidy otherwise the exports will decline substantially and imports will increase to the detriment of the local industry. The local industry will suffer due to heavy imports and become uncompetitive.
President UNISAME Zulfikar Thaver urged the FM to look into the matter seriously as the exporters are not in a position to export due to loss in realization of proceeds at the current rate. The exporters are not prepared to suffer continuous losses. To enable and maintain exports the governments needs either to allow a bonus rate of exchange for exporters and different rate for importers.
The governments needs to ensure that the inputs for the agricultural sector and the industrial sector become less costly and also the cost of finance is beneficial to remain competitive. The discount rate needs to be lowered to reduce cost of finance.
All factors of production except labour needs immediate correction and fuel. logistics, packing and raw material be made cheaper with reduction in import duty without loss of time otherwise the repercussions due to fall in exports and increase in imports resulting in adverse balance of payment will be noted.
Thaver said to avoid the dilemma it is important that steps and measures are taken simultaneously for maintaining exports. The exporters of farm produce are in doldrums and the SME exporters of farm produce are unable to transact business as they have purchased goods intended for exports and are not getting even the cost back if they propose at the existing parity rate.
He said the cost of production is high and the return is less if this state of affairs continues then the farmer will be reluctant to cultivate and will resort to growing of selected items only and as a result the exports will suffer. He said the government should not misunderstand our plea because the business community wants the rupee and economy to grow but calls for steps to maintain balance.
He said the government offered the handsome rate of profit on Euro Bonds and likewise the government should aim at giving the equivalent subsidy to those who are earning the foreign exchange. If the government can afford to give a benefit to the buyers of Euro Bond to get foreign exchange why should it not give the benefit to its own exporters who would be earning the foreign exchange.
For more information, Contact:
Union of Small and Medium Enterprises (UNISAME)
75/1 3rd Commercial Street,
Phase IV, D.H.A., Karachi, Pakistan
Phones: + 92 35884225 and 6
Cell: + 92 300 8245307 and + 92 321 8245307
Fax: + 92 35380642