The country’s bureaucracy still has the influence of British legacy. The successive governments tried on several occasions to change the rule of business and reform the whole bureaucratic system, but a total overhaul is still pending as it takes extra efforts to break the routine. The country needs reforms in every sector whether it is social, educational, the economic or health and policymakers have either limited powers to start the reform process or they have to look toward political leadership for advice. Since Pakistan started obtaining foreign loans, the donor agencies have been advising the government of the time to introduce structural reforms. Reforms are indispensable for financial sector which include a change in the rule of business for the taxation authorities, a modern well equipped banks system and overhauling of ministries and public sector organizations.
The current priority is to create opportunities for foreign and local investment. The government should have to make rules to offer concessions to foreign investors, not only in the stock market but also in the real estate, banks and industrial sectors. The foreign investors from certain countries have already participated in various developmental projects and the China Pakistan Economic Corridor is the latest example of local attraction for big investors. However, if the government opts for reforms and takes drastic steps to contain the powers of the local authorities, it is hoped that the foreign investors will not hesitate to put their money in this country.
Experts believe the government should revise its policies to promote capital formation and investment in the country. The taxation department is the main government agency which needs reforms as the foreign investors take interest only in places which offer tax incentives and their capital’s security. The local business community is long been demanding the government to withdraw super tax and suspend tax on bonus shares and retained reserves. The procedure to startup should also be evolved and ease of doing business also needs special attention in the current circumstances. The number and rate of taxes are very high which also needs revision. The prime minister has announced a package of Rs 180 billion to boost exports which have been declining for the last three years. However, it is yet to be seen how this money will be utilized. The imports are increasing day by day and Pakistan is facing trade deficit of billions of dollars with various countries. The government should immediately start the reform process to resolve the issues which create hurdle in the way of development. Both business and reforms should go together.
