High energy prices, a root cause of economic turmoil

High energy prices, a root cause of economic turmoil

Mian Kashif Ashfaq, Managing Director ChenOne highlights issues facing business community

Says govt should announce incentive packages for manufacturing, textile industries to compete in international market

By Azhar Bukhari

AFTER the recession in the world economy, problems are escalating with every passing day for exporters of Pakistan particularly in textile sector.
Ever increasing rates of Oil, gas and electricity as well as the less availability of these energy resources, are pushing the local exporters to the corner in the international market.
It was the viewpoint of renowned business man and Managing Director ChenOne, Mian Kashif Ashfaq, which he expressed this in a meeting with The Post.
“In my opinion, the federal government should announce incentive package for industrialists related to export sector without any further delay to get the economy back to rails. The prolonging power crisis and high fuel prices have already damaged the local manufacturing industry, which could only be restored if government take some practical steps in this regard,” Mian Kashif observed.
He maintained that the most dangerous factor facing by the business community is the law and order situation and the terrorist activities in country.
These activities disturbing the both national and international businesses as no foreign company ready to invest in Pakistan.
“A fund should be announced to explore the more international markets especially TDAP and ministry of Industry should apply the serious efforts to branding of Pakistan in the world and promote the industrial and commercial image,” MD ChenOne said.
However, the federal government would have to give priority to continuity of electricity supply as well, he maintained. “In the absence of proper policy planning, no package would work,” he added.
He stressed the need for identification of the areas for the guidance of the foreign investors besides only focusing on manufacturing sector.
An energetic business activist, Mian Kashif said that there is no need for being pessimistic as every crisis has in its fold some opportunities as well. “The country is facing severe energy crisis, from electricity shortage to high fuel prices, problems and hurdles are everywhere, but it is also an opportunity for businessmen to put their money in power projects,” he elaborated.
Mian suggested the government to fix the electricity and fuel prices for at least 5 years for the revival of economy.
“I have always been of the opinion that commerce related policies should be fixed for a certain period of time.”
He was of the view that a strong liaison between the policy makers and the stakeholders could also be helpful in bringing the country out of mire.
He said that the incentives being offered to the foreign investors by the Board of Investment should also be given to the local businessmen so that they could be able to put their money in new ventures.
He maintained that drastic cut in government expenditures and enhanced productivity were the answers to the liquidity crunch. He urged the State Bank of Pakistan to announce cut in interest rates without any further delay as it is a prerequisite to enhance industrial production. At a time when the whole industry is badly suffering due to high cost of doing business and complaining of being uncompetitive in the global market, the SBP has taken a totally otherwise step, he added.
He was of the view that imbalances in the economy such as increasing trade deficit, current account deficit, high saving and investment gap, huge government borrowing and persistent high inflation including food inflation would leave a very negative impact on the national economy.
Renowned industrialist Mian Kashif said that the government should evolve long-term and short term plans to enhance electricity production in consultation with real stakeholders. He stated that long term plan include utilizing all hydel resources by building big water reservoirs and power generation units which is a cheaper way to produce energy. He said that government should also go for alternative energy resources like other countries. He mentioned that Germans are producing more than 21000 MW and while India are producing more than 7000 MW power through wind energy.
Furthermore, Mian strongly criticized NEPRA decision to allow power distribution companies to increase in power tariff. He said that this decision would be last nail in the coffin of industrial sector.
He said that only because of huge undiscovered potentials in Pakistan and for having a unique food basket, a number of foreign investors are ready to come to Pakistan.
He called for revival of freight subsidy to give boost to exports as the freight subsidy was making Pakistani exports uncompetitive in the global market which has a huge potential for Pakistani goods, particularly chicken meat.
He was of the view that compliance to all international norms and standards is a must to get competitiveness and only those organizations would be able to get a respectable space in the global market that are world standards compliant.
He said that industrialists training through such seminars and training sessions would help them meet the challenges of 21st century.



Profile

Mian Muhammad Kashif Ashfaq is Managing Director/Head of ChenOne Stores Ltd and ChenOne WorldWide Travels.
ChenOne is a subsidiary of Chenab Limited, formerly Chenab Fabrics and Processing Mills Ltd.
Chenab Group is one of the largest exporters of home textiles, apparel & value added products from Pakistan.

In 1997, ChenOne opened its first branch in Jinnah super, Islamabad. At present ChenOne has opened its branches in Karachi Park Tower, Tariq Road, Lahore Gulberg, DHA, Islamabad, Rawalpindi, Peshawar, Abbottabad, PC Bhurbun, Faisalabad, Multan, Sialkot, Gujrat & Rahim Yar Khan.
With the target of opening 50 stores in Pakistan by 2015, ChenOne will maintain its status of largest Chain of Stores in Pakistan.