Pakistan industry warns of Sri Lanka like crisis

Leading businessmen at the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) analysed the looming threat of a Sri Lanka-like economic emergency as the dollar hit an all time high against the local currency, local media reported.

FPCCI President Irfan Iqbal Shiekh said the rupee's free fall has reached a point where it has become a threat to national security as the letters of credit (LCs) for petroleum imports were being opened at a much higher rate than the interbank rate, Dawn reported.

He feared that a serious law and order situation might emerge in the event of any fuel shortages for transportation and electricity generation.

"We are not far from a Sri Lanka-like scenario and radical decisions are needed to reverse the situation," Dawn reported quoting the FPCCI president as saying.

Leading businessman Aqeel Karim Dhedhi expressed his shock that despite the fact that many numbers are showing improvement over the last few weeks, such as global oil prices, declining edible oil prices and better supplies of many other commodities, the government has failed to rein in inflation.

In a statement, Korangi Association of Trade and Industry (KATI) President Salman Aslam, said the business community had serious reservations about the government's mysterious silence for not taking any steps to manage the declining economy.

He said that the value of the rupee was depreciating artificially, leaving the currency free-floating in the market and causing severe losses to the economy. Investors have lost confidence after the stock market crash and the negative rating of Pakistan by Fitch rating agency, Dawn reported.

Aslam predicted a storm of inflation if the rupee continued to fall against the dollar.

Indo-Asian News Service