Atif Ikram Sheikh, President of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), has vehemently criticized the recent decisions by the governments of Khyber Pakhtunkhwa (KP) and Balochistan to impose an Infrastructure Development Cess (IDC) on both imports and exports.
He labeled these actions as detrimental to business and export efforts in Pakistan. Sheikh stated that the FPCCI, as the apex trade body, is receiving overwhelming feedback from various chambers, associations, and trade organizations across the country, all advocating for the reversal of these counterproductive measures.
He emphasized that international export markets are highly competitive, and any increase in production costs due to additional duties, taxes, or cesses can significantly impact the ability to fulfill export orders efficiently and profitably. Sheikh pointed out that the FPCCI has consistently opposed the imposition of undue and unfair IDC on imports.
However, the recent developments have escalated to the point where provincial governments have extended this tax to exports as well. Specifically, Balochistan has introduced a 1.15 percent cess on both imports and exports, along with an additional charge of 1 paisa per kilometer. In comparison, KP has imposed a 2 percent cess on the same categories.
The FPCCI President has called for the immediate withdrawal of the IDC across all provinces, urging Prime Minister Shehbaz Sharif and the Special Investment Facilitation Council (SIFC) to take action. He warned that such measures undermine national interests by making the country’s exports more expensive.
To bolster the competitiveness of exports, Sheikh proposed the implementation of a renewed and effective Temporary Economic Relief Facility (TERF), an Export Finance Scheme (EFS), and a Long-Term Financing Facility (LTFF). He stressed that these initiatives are essential for stimulating economic activities, encouraging investments, promoting industrialization, and ultimately enhancing exports.
