LAHORE: As the remittances have registered a decline of more than 36 percent, the All Pakistan Business Forum (APBF) has suggested to the government to announce incentives for oversees Pakistanis so that the drop could be controlled; besides investment by Pakistani expatriates could be boosted.
APBF President Ibrahim Qureshi said on Sunday that Current Account (C/A) deficit had widened to $591 million in July 2016, whereas $575 million deterioration was largely owing to $745 million (or 36 percent MoM) decline in remittances.
Remittances sent by overseas Pakistan registered an annual drop by 20 percent to $1. 33 billion in July. The oil-rich Arab countries account for almost 65 percent of entire remittances sent by overseas Pakistanis.
Qureshi feared that the fall could be a setback for Pakistan as it largely depended on remittances to meet its foreign obligations and increase its reserves. In July, the inflow of remittances from Saudi Arabia had dropped by 20 percent, but it was still the highest at $379 million. What is more concerning is the plunge in remittances from the United States and the United Kingdom as inflows from these countries fell by 33. 5 and 38 percent, respectively. Remittances from US and UK had come down by 6 percent and 8 percent, respectively, in the preceding fiscal year.
The APBF president opined that if the government would assist the overseas Pakistanis and provide them incentives, they could play a pivotal role in boosting Pakistan’s economy through their remittances and investments.
He said that oversees Pakistanis could invest in agriculture, transportation, telecom and energy sectors, which had huge potentials. “The government has badly failed to attract foreign investment because delay in the approval of projects discourages the investors,” he added. Qureshi asked the bureaucracy to simplify the procedures by revisiting the existing processes so that the investors could be facilitated.
He said that export-oriented industries should be facilitated by making rules, regulations and procedures simple. “It is a matter of concern that exports are declining in spite of the fact that country has all the resources,” he lamented.
“We have to focus on investing in the energy sector, lowering of tariffs on smuggling prone items, increasing the share of direct taxes in revenues and lowering the slab of indirect taxes to achieve key economic targets set for the year, 2016-17,” he emphasised.
Qureshi said the Protection of Economic Reforms Act, 1992 should also be amended appropriately in order to curb remitting undeclared income through unofficial channels outside Pakistan, and the same being brought back to Pakistan through banking channels in foreign exchange.
