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Apr  01 - 07, 2002

Iftikhar Ghani Vohra, is the Senior Vice President of Karachi Chamber of Commerce and Industry (KCCI). He is a prominent businessman and serving for the cause of trade and industry for the last 25 years in Karachi. He has been associated with KCCI in one capacity or the other. He served KCCI as the chairman of various sub-committees in the past.

Iftikhar Vohra is the Chief Executive of I.G. Traders, which deals in Petro-Chemicals, Rubber and in a variety of relevant items.

PAGE: Being the senior leader of Pakistan's largest chamber what do you feel about economic revival in Pakistan.

VOHRA: Apart from official version about strong economic signals especially at macro level, the ground reality gives a different picture. Markets and Bazaars are presenting a deserted look due to absence of interest of the buyers or whatever the reasons may be.

PAGE: Would you suggest ways to improve economic activity at the market level.

VOHRA: In fact the government has announced the best economic policies, yet there is the question of implementation. However many policies announced by the government are implemented in letter and spirit. This is the culture of bureaucratic arrogance, greed and corruption, which never allows even the best decisions to bear fruit.

Take the current campaign of the government for revenue generation and documentation. The government has imposed the sales tax on one hand while over six per cent withholding or presumptive tax is being charged at the port level. Such instances of double taxation will have to be checked before levying any tax on any commodity.

PAGE: Are you not in favour of the documentation to bring stability to the economy.

VOHRA: The primary purpose of the government policies of documentation is to enhance the tax base, contrary to this focus what the results are coming out. In fact this will open new doors of corruption and opportunities to the corrupt. Instead of going into complexities, the system should be made as simple as possible to get maximum tax from the willing tax payers instead of allowing it to going to the pockets of the corrupt.

PAGE: The power utility services that is WAPDA and KESC have been allowed to further increase in the tariff. How the industry will adjust this increase except passing it on to the consumers to overcome the increase in cost of production.

VOHRA: KCCI has already issued its version on the increase in power tariff. KCCI believes that industrial consumers must not be targeted and blamed for the losses incur into the KESC system over a number of years. It has been accused that the industrial consumers are using more power load than what had been sanctioned to them.

The KCCI brushes aside this blame on the grounds that generally industrial units have maximum demand indicator meters indicating the highest consumption of electricity, regardless sanctioned load. Since every units consumed by the industrial consumers is paid accordingly hence the question of loss of revenue to the KESC does not arise. The mechanism of regularizing the load and the operation conducted for the purpose, left much to be desired. Pressure rather than persuasion or consensus of the two sides characterizes this campaign.

PAGE: The imposition of 15 per cent GST on medicines is generally being opposed by different segments of the society. What is the stand of the KCCI on this issue?

VOHRA: The KCCI has already expressed its resentment on the imposition of 15 per cent GST on all kinds of medicines, whether imported or locally produced. The cost price of medicines in Pakistan was already on the higher side and this additional burden would have a crippling effect on pharmaceutical industry, rendering the medicines beyond the reach of the common man. We should look at this issue purely on humanitarian grounds. Medicine was an item which is the most essential and lifesaving and to target it for revenue mobilization, at the behest of IMF was indeed most unfortunate. On the other hand government expenditures on the health sector are already on quite insignificant level.

PAGE: What would you suggest to improve the health sector in Pakistan:

VOHRA: Although the import duty has been reduced from 10 per cent to 5 per cent on raw material for manufacturers of pharmaceutical products, however it would not suffice to compensate the sales tax. The modus operandi and mechanism of imposing sales tax was so complicated and cumbersome that printing of sales tax amount and to maintain complete record of almost 30,000 registered medicines would pose many-sided problems both for the collectors and the receivers. The contention of utilizing the additional amount to be mobilized through sales tax of around Rs5 billion on health sector was not tenable because the amount to be recovered from the same sector would be reinvested in the same sector. On the other hand the complications being created in health sector may scare away further investment in this sector.