The Disposable Food Packaging Association (DFPA) has termed the high cost of doing business harmful for businesses, saying ever-increasing cost of production was the real threat to the economy amidst frequent upward revisions in policy rate and continuous fluctuations in rupee against dollar.
In a statement issued on Friday, President DFPA Ahsan Shahid said that constant hike in power tariff has pushed the electricity prices higher and added to the already soaring cost of trade and industry.
The government must shut down all expensive oil-based power plants to ensure availability of cheaper energy for consumers, he said and condemned the government for shifting power distribution companies’ inefficiencies’ burden to the consumers by jacking up the tariff under the guise of Fuel Charges Adjustment.
Ahsan Shahid observed that the aggressive economic measures, high borrowing rates, inflation, oppressive taxation and unstable currency have been negatively affecting running businesses.
With a view to deal with fiscal challenges, he asked the economic managers to work on the three-way strategy by implementing short-term goals that will help to keep generating resources for smooth fiscal operations, medium-term goals where the they should focus on financial inclusion, documenting the economy by designing a system where all businesses can be registered and properly document their income including collection of sales tax, initiating the process of privatisation as well as improving governance by introducing reforms in each sector. As a long-term goal, the country must focus on improving its human capital, and revamping IT sectors by extending facilitations and providing all the requisite supports.
The DFPA President stated that the significant jump in electricity prices and hike in gas tariffs to meet the IMF condition will put additional burden of billions of rupee on consumers. He observed that it is unfortunate that the authorities in all governments continued to approve billions of rupees’ additional burden on consumers through a direct tariff increase and an indirect increase through the withdrawal of subsidies given to exporters and farmers earlier. He said that the government liquidity and external vulnerability risks are elevated and there remain considerable risks around its ability to secure required financing to fully meet its needs for the next few years.
