PPA
Islamabad: Former President of the Islamabad Chamber of Commerce and Industry (ICCI), Dr. Shahid Rasheed Butt, said on Sunday that unresolved issues and tough business environment are driving international investors away, which is not good for the reputation of the country.
He stated that it is crucial to resolve the issues of foreign investors immediately to ensure their continued presence in Pakistan.
How new investment will come to Pakistan when local and foreign investors are fleeing the country, he asked.
Shahid Rasheed Butt said in a statement issued here today that many foreign companies working in oil, gas, pharmaceuticals, mining, telecom, transport, and many other sectors have already left Pakistan.
In contrast, dozens of companies have scaled down their operations while several companies have sold their shares in large numbers to reduce their presence in Pakistan, which discourages other investors while defaming the country.
He said that last year, Shell, which had been doing business in Pakistan for 75 years, decided to sell all its assets to a Saudi retailer. Now, British American Tobacco (BAT), an old multinational, has decided to leave Pakistan in case of a further increase in taxes.
Shahid Rashid Butt said that the demand to increase the tax on cigarettes is getting stronger. Still, it is wrong to deal with everyone in the same way.
Authorities should spare companies that are not involved in tax evasion and should treat those known for tax evasion differently.
He said that the influential cigarette mafia has been creating problems for BAT, which provides financial support to the Khyber Pakhtunkhwa government in difficult situations.
The company’s management believes that they are in Pakistan to pay taxes as their profit margin is shrinking rapidly. If they leave, it will send a very negative message to investors around the world, and many will back off.
He said that the cigarette mafia has taken control of 58% of Pakistan’s market, and their business is expanding due to political support. They are not paying taxes, and there is an increasing pressure on the companies that do pay taxes.
He said that foreign investment is booming in India and Bangladesh, while lack of competence and poor planning reign in Pakistan’s politicians and bureaucracy, resulting in falling foreign investment.
Nothing has been done to facilitate foreign investors, expand the tax net, catch tax evaders, or discourage smuggling, he said.
Electricity and gas prices, a 22 percent interest rate, political instability, smuggling, a law-and-order situation, and other problems are all increasing challenges for industrialists.
He warned that if the bureaucracy does not change its attitude and does not make decisions according to ground realities, investment in the country will decrease further.