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Express Tribune
5 days ago
- Business
- Express Tribune
IT sector seeks policy continuity
Pakistan Freelancers Association Chairman Ibrahim Amin cautioned against increasing tax rates on freelancers, who already pay taxes on every transaction in addition to fees charged by freelancing platforms and payment gateway service providers. photo: REUTERS Listen to article Key stakeholders of the IT industry have urged the government to continue reforms and extend incentives for the significant growth of the IT sector and its allied fields to enhance export earnings and create jobs for youth, in line with the objectives of the futuristic "Uraan Pakistan" economic plan. They called for incorporating their recommendations in the upcoming federal budget 2025-26 to enable the IT sector to grow faster, generate more employment opportunities, and contribute more effectively to strengthening the national economy. They also stressed the need for continuity of existing policies and resolution of regulatory and tax-related challenges in the finance bill for 2025-26, particularly for the IT industry and freelancers, to help accelerate sectoral growth and development. Khushnood Aftab, Convener of the IT Committee at the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), recommended that the government reduce import duties on essential hardware components such as RAM, SSDs, motherboards, batteries, and displays. This would support the local assembly of fully built imported devices like laptops, desktops, and tablets, fostering local value addition and attracting investment in domestic production facilities. He noted that increased support for the localisation of computer devices and hardware accessories could help Pakistan conserve foreign exchange, create skilled jobs, and position itself as a competitive exporter in regional markets. The locally branded IT hardware sector, he added, deserves focused attention as it directly aligns with the "Made in Pakistan" initiative and the broader Digital Pakistan vision. Furthermore, he emphasised the urgent need for the fair inclusion of local brands in government procurement, which would encourage scale, improve quality, and support domestic industry without compromising standards. Pakistan must also prepare for the growing demand for AI-integrated hardware and edge computing devices, he said, which could be achieved through the introduction of targeted Research and Development (R&D) tax credits and innovation grants to support companies working on emerging technologies within the country, said Khushnood Aftab, who is also Chairman Viper Group. Muhammad Umair Nizam, Senior Vice Chairman of the Pakistan Software Houses Association (P@SHA), said the IT sector is a key driver of economic growth, job creation, and foreign investment. He stressed that extending the Final Tax Regime (FTR) for the next decade would provide the policy stability necessary to encourage reinvestment and help Pakistan maintain its competitive edge in global markets. He also urged the government to harmonise the definitions of IT and Information Technology Enabled Services (ITeS) across federal and provincial tax laws to ensure consistency, eliminate jurisdictional ambiguities, and reduce compliance burdens. A unified framework, he said, would enhance investor confidence, streamline taxation, and promote sectoral growth by creating a predictable regulatory environmentultimately strengthening Pakistan's digital economy and competitiveness. Equally important, he said, is reducing income tax for salaried IT professionals, which would help retain top talent and mitigate the ongoing brain drain. Pakistan Freelancers Association Chairman Ibrahim Amin cautioned against increasing tax rates on freelancers, who already pay taxes on every transaction in addition to fees charged by freelancing platforms and payment gateway service providers. He recommended that the government exempt freelancers and IT companies from withholding tax (WHT) on international transactions under the Exporters' Special Foreign Currency Account (ESFCA) in the upcoming finance bill, following the concurrence of the Ministry of Finance and Revenue. He also urged the finance division to ensure that all features of the Roshan Digital Account (RDA) be extended to ESFCAs for IT companies and freelancers, enabling them to benefit from streamlined banking services and improved access to capital.
Business Recorder
26-05-2025
- Business
- Business Recorder
FPCCI seeks implementation of power tariff relief
PESHAWAR: Coordinator of Federation of Pakistan Chambers of Commerce and Industry (FPCCI) from Khyber Pakhtunkhwa Region has urged the prime minister to materialize his commitment of reducing the electricity tariff by Rs 7 per unit. He also demanded to end the severe and unjust load-shedding in Swat, which he said has crippled both daily life and economic activity in the region. In a statement issued from the FPCCI regional office in Peshawar on Sunday, Akbar Khan expressed deep disappointment over the lack of implementation of the relief in electricity tariff announced by the prime minister. 'The PM had declared a Rs7 per unit reduction in electricity rates, but this promise remains unfulfilled, leading to frustration and disillusionment among the business community,' he said. FPCCI urges govt to draft 10-year industrial policy He criticized the government for spending millions on advertisements promoting the announcement, while no concrete steps have been taken since. He further stated that authorities have also failed to curb electricity theft effectively. 'On one hand, we are battling the high cost of electricity, and on the other, rising petrol prices are adding to the public' suffering. There has been no relief at all,' he said. Akbar Khan urged the government to abolish the slab system in billing and end the provision of free electricity units, arguing that such policies unfairly burden paying consumers. Copyright Business Recorder, 2025
Business Recorder
26-05-2025
- Business
- Business Recorder
BMP voices its concerns over delay in budget presentation
LAHORE: The Federation of Pakistan Chambers of Commerce and Industry's Businessmen Panel (BMP) has expressed serious concern over the government's decision to delay the presentation of the federal budget for the fiscal year 2025-26 and the possible imposition of additional levies, including a sharp hike in the petroleum levy. The BMP Chairman and FPCCI former president Mian Anjum Nisar termed these developments deeply troubling for the already struggling business community and warned that such decisions would further strain the economy and damage investor confidence. He said that the federal government recently shelved its plan to present the budget on June 2 and is now expected to unveil the fiscal plan on June 10. The delay has been attributed to Prime Minister Shehbaz Sharif's foreign tour as well as internal disagreements over the finalisation of expenditures. He said that this postponement creates unnecessary uncertainty at a time when the business environment is already fragile due to inflation, high energy costs, and sluggish growth. Mian Anjum Nisar stated that the delay in the budget presentation sends a negative signal to the market, businesses, and foreign investors who are waiting for policy clarity. He said that businesses plan their fiscal year strategies based on expected policy announcements, and any delay hampers their ability to make timely decisions regarding investment, procurement, and employment. He added that the lack of transparency around budget planning is further eroding trust between the business community and the government. The BMP is particularly concerned about the government's reported move to increase the petroleum levy, which currently stands at Rs78 per litre. The government is reportedly considering raising this levy further in order to finance a larger Public Sector Development Programme (PSDP) of Rs1 trillion for the next fiscal year. Mian Anjum Nisar warned that any additional levy on petroleum products would result in a significant increase in the cost of doing business, leading to a rise in inflation and further weakening the purchasing power of consumers. He noted that fuel is a key input for industries, transportation, and agriculture, and any increase in its price has a ripple effect across the entire economy. Instead of increasing indirect taxes like the petroleum levy, Nisar urged the government to focus on broadening the tax base, curbing unnecessary expenditures, and implementing structural reforms to improve revenue collection without burdening businesses and the general public. He also criticised the lack of stakeholder consultation in budget-making, especially when businesses are the biggest contributors to taxes and employment. Nisar said that the upcoming budget appears to be driven largely by the International Monetary Fund's directives, with little attention paid to the domestic realities faced by industrialists and exporters. He stressed that the government must engage with business leaders to frame policies that are sustainable and practical, rather than relying solely on external advice. The BMP also raised concerns about possible cuts to subsidies and increased energy costs in the upcoming budget. Nisar warned that the business community will not be able to absorb any further increases in electricity and gas prices, as production costs have already reached unaffordable levels. He said that many industrial units, especially small and medium enterprises, are on the verge of closure due to high input costs and lack of support from the government. The panel also criticised the government's handling of the circular debt issue in the petroleum sector. The plan to use inflated dividends from state-owned enterprises to clear circular debt lacks transparency and may lead to market distortions. Nisar said that instead of adopting temporary fixes, the government should address the structural flaws in the energy sector, including mismanagement, inefficiencies, and losses in transmission and distribution. Nisar further said that the recent abnormal increase in the share price of Pakistan State Oil (PSO), despite its poor financial condition, raises serious questions. He supported the IMF's decision to seek more clarity before approving the government's plan and expressed concern over the exclusion of PSO from the debt retirement scheme. Copyright Business Recorder, 2025
Business Recorder
24-05-2025
- Business
- Business Recorder
Iran, Türkiye, Azerbaijan: FPCCI terms PM's visit ‘positive, timely' step
KARACHI: Vice President of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), Amaan Paracha, has welcomed Prime Minister Shehbaz Sharif's visit to three countries – Iran, Turkiye, and Azerbaijan – calling it a positive and timely step. He stated that enhancing trade among these three brotherly Islamic nations is the need of the hour. Amaan Paracha noted that in 2024, the total trade volume between Pakistan and Türkiye reached a historic high of $1.4 billion, nearly 30% more than in 2023. However, despite this increase, both countries are aiming to reach a $5 billion trade volume. In February 2025, Pakistan exported $29.7 million to Turkiye while importing $46.9 million, resulting in a trade deficit of $17.1 million for Pakistan. He further stated that in the current fiscal year, the bilateral trade volume between Pakistan and Iran reached approximately $2.8 billion. While both countries have expressed a desire to increase this trade to $10 billion, external factors such as U.S. sanctions on Iran have constrained economic ties. Nonetheless, if Pakistan and Iran make joint efforts to boost trade, it would strengthen both economies. Amaan Paracha also highlighted the growing trade relations between Pakistan and Azerbaijan, saying that Azerbaijan could become a strong trade partner for Pakistan in the future. He shared that in 2024, the trade volume between Pakistan and Azerbaijan reached $22 million, a 22.5% increase compared to 2023. This included $21.8 million in imports by Azerbaijan from Pakistan and $196,000 in exports by Azerbaijan to Pakistan. The prime ministers of both countries have expressed interest in increasing bilateral trade to $2 billion, and Prime Minister Shehbaz Sharif's visit has opened up vast opportunities to enhance this trade relationship. He added that Prime Minister Shehbaz Sharif should also brief the three brotherly Islamic nations on India's regional aggression and inform them about how India is spreading terrorism in the region. Copyright Business Recorder, 2025
Business Recorder
15-05-2025
- Business
- Business Recorder
‘Frequent policy changes hindering industrial growth'
KARACHI: Syed Mazhar Ali Nasir, former Senior Vice President of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has emphasised that frequent policy changes, lack of long-term vision, inconsistent regulatory framework, and policies made without stakeholder feedback have hindered industrial growth and investment. Delivered a presentation to the 37th Senior Management Course at the National Institute of Public Administration (NIPA) on the industrial development of Pakistan , Mazhar Nasir highlighted the structure of Pakistan's industry, comprising large-scale industries and small and medium enterprises (SMEs), which contribute 40% to GDP and 30% to exports. He noted that SMEs face challenges such as limited access to finance, infrastructure deficiencies, and marketing support, and stressed that export growth cannot be achieved without the development of the SME sector. The presentation also covered emerging industrial sectors in Pakistan, including the automobile, iron and steel, edible oil, sugar, cement, ceramics, and rice industries. Nasir emphasised the need for long-term policies and strategies, incentives for investment and innovation, enhanced infrastructure and logistics, and research and development promotion to drive industrial growth. He also highlighted the importance of Special Economic Zones (SEZs) in the context of the China-Pakistan Economic Corridor (CPEC), noting that SEZs can promote industrial growth and attract foreign investment. Mazhar Nasir concluded that Pakistan's industrial sector must adapt to changing global trade dynamics by diversifying exports, enhancing competitiveness, promoting value-added products, and building strategic partnerships to achieve sustainable economic growth. 'By addressing these challenges and opportunities, Pakistan can accelerate industrial development and achieve sustainable economic growth.' Copyright Business Recorder, 2025
