LAHORE The business community and the manufacturers associations, while expressing grave concern over massive jumps in power tariff, have observed that more than 72 per cent hike in electricity rates in the last five months is the major cause of continuous economic meltdown in the country. Besides, they said, electricity and gas shortage, high mark-up rate, huge banking spread, Rs 600 billion annual loss making state-owned enterprises, unskilled workforce and poor infrastructure were also hurting the economy badly. They said that the country needed to invest heavily to overcome the growing electricity and gas deficit resulting from energy policy and planning neglect on the part of the policy-makers in the last three decades. Electricity shortage alone was costing the economy around Rs250 billion per annum. Almost 70 percent of power generation is oil/gas-based. This is expected to increase the gas supply-demand gap to around 1,127 million cubic feet per day (MMCFD) in January and 1,046 1 MMCFD per day in February. Chairman Lahore Township Industries Association Haroon Shafiq Chaudhry, Chairman PIAF Sohail Lashari and Chairman Auto Parts Manufacturers & Exporters Association Tahir Javed Malik said that massive increase in one-go in the electricity tariff and gas prices is not only anti-industry but also anti-masses. Unprecedented increase in the electricity and gas prices would also hit the government reputation hard therefore Prime Minister should reject the summaries seeking raise in gas and power tariffs. They said that Lahore High Court has stopped the recent hike in the electricity prices in the name of fuel adjustment and now NEPRA has planned to snatch huge money by making massive increase of 31 percent in the prices of electricity being generated through hydel resources. LCCI President Irfan Qaiser Sheikh observed that Pakistan needs to fast track the construction of infrastructure projects like import of gas from Qatar, Iran and Turkmenistan. Iran-Pakistan (IP) and Turkmenistan-Afghanistan-Pakistan-Iran (TAPI) pipelines are critical for meeting future needs of the economy and society; the former can supply 750 MMCFD while TAPI has 1300 MMCFD capacity. Pakistan should formulate an Energy Security Plan and electricity supply should become an essential part of this framework. The LCCI President said the economic growth requires infrastructure. The country is falling behind in the development of widespread Special Economic Zones, Export Processing Zones, Industrial Parks and other specialized infrastructure. We need to invest in the essential infrastructure for growth such roads, bridges, airports and rail network as well as widespread access to affordable and reliable utilities and a nationwide digital outfit geared to increase productivity. We are still not using information and communication technology to improve our way of doing business. We also need to build large-scale research and development infrastructure to support innovation, high-quality and high-value production and diversification of economic activities. Sheikh said that the private sector is main stakeholder when it comes to economy and without taking it onboard in the formulation of business-related policies an economic turnaround would be day dreaming. Sheikh said that interest rates need to be in single digit for reducing the cost of borrowing while ensuring that banks increase cash-flow lending and reduce emphasis on collateral. Improving access to finance must also be accompanied by increased availability of venture-capital. The State Bank should encourage gradual expansion and diversification of financial products while at the same time paying closer attention to the supervision of the entire banking system to prevent large-scale failure. At the same time, the government must also adopt fiscal restraint and reduce bank borrowing in order to ensure that private sectors access to finance is not undermined. The LCCI President said that the Public Sector Enterprises (PSEs) such as Pakistan International Airlines, Pakistan Steel Mills, Pakistan Electric Power Company, Pakistan Railways, National Highway Authority, Pakistan Agriculture Storage and Services Corporation and the Utility Stores Corporation continue to exert substantial burden on the public finance. These eight PSEs are incurring losses of around Rs600 billion annually. The LCCI recommends immediate revival of the privatization program. Selling these organizations for Re1 each would also be better for economy as this would immediately reduce a burden of around Rs.600 billion on the public finance which is considerably higher than Pakistan s annual development budget. Above all, the government has no business to be in business.