All Pakistan Textile Mills Association (APTMA) Patron In-Chief Gohar Ejaz has warned that Pakistan might face a similar situation as Sri Lanka if reforms are not made in almost every area of the economy.
Ejaz said that a default situation would result in a damaged relationship with investors and have far-reaching consequences.
He said that to enable economic stability and sustainable growth we must take a hard look at our policies to identify roadblocks and inefficiencies. He was of the view that Pakistan needed to nurture an export culture, and focus on investment, productivity, and exports while removing bottlenecks.
Historically, we focused on taxation instead of growth. We must shift this focus to growth by prioritizing investment, productivity, and exports, he said.
Commenting on the energy sector, Ejaz said that the energy sector needs reforms, as mismanagement is rampant. The gas crisis is worsening as international exploration companies have left Pakistan and local companies are not performing, leading to lower domestic gas production.
In the power sector, distributing companies (DISCOs) need to be divided into smaller units (city-wise) for better administration and management, he added.
Commenting on exports, he said that the ideal way forward is developing a culture wherein all investments and operations are focused to maximize exports. The textile sector is the key player since it contributes 62 percent of all exports and has performed exceptionally well in the last two years, with textile exports increasing by 43 percent in FY22 compared to FY18, he said.
Quoting the Western Economist Noble Prize winner, Joseph Stiglitz, he said that the Noble laureate had discouraged the traditional global economic practices that Pakistan is also a blind follower of. Pakistan has increased interest rates from 7 to 15 percent in 6 months which has put a burden on the cash-starved government, he added.
Ejaz said that Pakistan needs a strong export base that serves as the baseline to strengthen the economy without reliance on any foreign aid. Earnings through enhanced exports can strengthen the economy significantly, bringing Pakistan out of its current account deficit and economic stagnation. Enhanced exports are the only solution for rapid recovery from the current economic crisis, he added.
