PBC asks caretaker setup to tackle economic crimes

KARACHI: Pakistan’s largest businesses are pushing the caretaker government to crack down on smuggling, tax evasion and electricity theft that are hurting the formal economy.

The Pakistan Business Council (PBC), a business policy advocacy group, called on the caretaker government to take action against smuggling, under-invoicing, electricity theft, misuse of the Afghan transit treaty, tax evasion by various sectors of the economy and the undocumented real estate sectors .

In a tweet, the PBC said that some of the fundamental reforms required in the economy, such as privatization or restructuring of state-owned enterprises and power distribution companies, may be beyond the scope of the interim administration.

The PBC said the interim administration has the power and responsibility to enforce the law against these economic crimes, which do not require any political considerations.

"It is well within the powers of any government (certainly the Caretaker, which has no vote bank to protect) to enforce the writ of the state," the council said. “A ‘do nothing’ approach does nothing to create a positive sentiment or hope. It only accelerates informalisation of the economy. Time to show some teeth!”

Pakistan is currently under an interm government led by caretaker Prime Minister Anwar ul Haq Kakar, who took office in August after the completion of the five-year term of the parliament. The caretaker government is responsible for ensuring free and fair elections.

The economy is facing multiple challenges, including a widening current account deficit, falling foreign exchange reserves, rising inflation and a depreciating currency. Analysts expect Pakistan may need another bailout program from the International Monetary Fund next year to avoid a balance of payments crisis.