Muhammad Suleman Chawla acting President FPCCI expressed anxiety that flight of dollar versus rupee is uncontrollable that must be stopped but we cannot understand how and when it would be done.

Talking to Daily National Courier, Chawla senior Vice President said that unstable devaluation would bring imported inflation that will destroy local industry. Recently excessive imports and shortage of dollar has further devalued domestic unit, it increased government debts.

This rate of fluctuation is due to tight control by State Bank and commercial banks which has caused increased holding of dollar. Ishaq Dar created three different rates of dollar that resulted in maximum holding of dollar. At present difference between official and unofficial rate is about 7 to 8 percent which was never more than 2 to 3 percent in past.

In recent past FPCCI had suggested government to announce amnesty scheme to bring out dollars from public custodies and bank lockers with time limits so that those amounts could be used in national interest. But it was not accepted for unknown reasons. It may be due to Financial Action Task Force restrictions from western countries, he said.  

Government should strictly ban import of all luxury items while opening import of industrial input. Since banks are not opening industrial raw materials import, speculation by big investors is on rise. Most of importers were unnecessarily importing many useless items. If dollar is available easily from banks its excess flight could be stopped.   

He said that local industry is quite upset due to non-availability of raw material while traders are earning big margins. On other hand few industries in country including automobile sector had wrongly claimed localisation of their parts but fact was opposite. If they do not act upon deletion programme, government should not allow them free imports because cars are luxury item. They should be compelled to export their products and foreign exchange earnings from this export may be utilised on import of their required items, instead of importing 80-90 percent parts and wasting precious FE. Country is already facing food security, in this position they should prefer to transform into local production of luxury items.     

He said that we have already suggested to higher authorities to sit with us and stop import of luxury and useless items as we propose and prefer import of industrial raw materials. So far government did not pay attention to our proposed policies that is ridiculous.

Replying to query he said caretaker government has inducted most of experts in their fields. Caretaker PM visited Karachi and left good impression on businessmen community. Supply of gas and electricity on reasonable rates and quantity is main input problem for local industry but prevailing prices were discouraging and leaving hopeless impact. This issue must be resolved on priority basis, he concluded.

Published in The Daily National Courier, August, 25 2023

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