Economists believe the potentials of the industrial sector are not fully utilized by the successive governments in the country despite positive indicators. As a result, the industrialists stopped local production and adopted a shortcut to manufacture their products in China and import the same into the country with their own brand names. As a result, the domestic markets are infested with foreign goods and a major chunk of which is imported by legal means. However, there is evidence that smuggled items are also available for sale in the country’s markets. Dilemma is that the legal import not only affects the local industry but also increase trade deficit. The smuggled goods, abundantly available in super markets, stores and godowns, are depriving the country of taxes and duties. The country is heading towards deindustrialization and the trend will drastically push the dwindling exports to further chaos. Whether it is a lack of ability of the government officials to stop smuggling or it is unable to rationalize the rate of taxes and duties are the questions to be answered.
On another note, money is regularly being transferred to the attractive destinations of the world and the government is apparently fully relying on foreign loans. The severe energy crisis and poor law and order are still haunting the nation and the government has failed to end load shedding despite over three years in the office. According to official circles, the government has ensured uninterrupted electricity supply to the industrial units, but the figures suggest the contribution of the industrial sector to the gross domestic product is mere 13.5 percent. The sector has been missing the official targets for the last three years. The State Bank has also reduced the lending rate from 9.5 percent to 5.75 percent in three years. However, the government will have to take proactive approach to boost the manufacturing sector. Incentives have been offered to the industrial sector to attract new investment in the country. The China Pakistan Economic Corridor is the game changer if investment is entailed with the project.
The speed with which the money and business are going out is a point to ponder. The free trade agreement with various countries, including China, are further putting up pressure on the local industry. The loss of industry not only means the loss of economy but also loss of jobs opportunities in the country. The country is producing thousands of professionals and the losses of jobs will encourage brain drain from the country. Pakistan is one of the most protected country in the world, but this policy did not work to the satisfaction of the business community. Therefore, new rules of business are required to deal with the situation.
