ISLAMABAD: The Islamabad Chamber of Commerce and Industry (ICCI) expressing grave concerns over the 5 to 11 per cent hike in petroleum products prices called upon the government to withdraw this increase urgently as it will have a negative impact on business and economic activities and bring more problems for the common man.
ICCI President Sheikh Amir Waheed on Tuesday said that the inflation in December has already gone up to 4.6 per cent due to increase in petroleum prices and regulatory duty and the recent hike in POL prices would further increase inflation that would cut the purchasing power of the consumers and lead to a further slump in business activities.
He said the economy of Pakistan was already facing many challenges as trade deficit had increased by over 28 per cent during the first five months of the current fiscal year (July to November). He said the main cause of rising trade deficit was the sharp growth in imports that went up by more than 21 per cent during the first five months of the current fiscal year compared to the same period of last year.
In this scenario, giving 5 to 11 per cent increase in POL products would further enhance the cost of doing business and affect exports.
The ICCI president said that though the price of crude oil in international market has crossed $ 60/barrel, but instead of making immediate transfer of its impact on to the consumers, government should have cut heavy taxes and duties imposed on petroleum products to save the trade and industry as well as the general public from further trouble.
He said for the last many years, Pakistan’s exports have shown a declining trend due to lack of supportive measures from the government. As a result, exports were struggling at around $ 21 billion in 2017, while the exports of our close neighbours India and Bangladesh have increased to over $ 275 billion and over $ 34 billion respectively during the same period. In this situation, giving a hike to POL price would further cause further fall in our exports.
Sheikh Amir Waheed stressed that the government should immediately withdraw the recent hike in POL prices and avoid taking such measures, especially at a time when the trade and industry are struggling for survival.
He was of the view that the industry would be the major victim of hike in petroleum prices as it is one of its major raw materials. He said if not taken back, hike in POL prices would have a negative impact on the overall economy as it would affect the industrial production, enhance transportation cost and reduce the competitiveness of Pakistani exports in the international market, besides increasing inflation in the country.