Office Bearers of Islamabad Chamber of Commerce and Industry (ICCI) in a meeting opposed the average 17 percent likely hike in POL prices with the imposition of carbon tax on POL products from 1st July 2009.

Addressing the meeting, Mian Shaukat Masud stressed upon the government to immediately withdraw carbon surcharge on POL products as it will put highly negative impact on business activities apart from unleashing a new wave of inflation for the common man.

He said in Pakistan, about 70 per cent of the energy generated was thermal which was produced from imported POL products and fuel oil. The imposition of carbon tax on POL products would give rise to electricity charges and prices of all commodities while the government would also not offer any subsidy or relief to the people.

So, this carbon tax would not only increase the financial miseries of 170 million people, it would also apply brakes on the industrial growth, as the input cost of fuel and electricity would increase manifold, he added.

However, office bearers of ICCI welcomed some positive steps of government by which government declared income tax collected on export proceeds as final discharge of liability, reduced withholding tax from four to three percent for industrial importers, abolished carbon surcharge on CNG, withdrew the requirement of NTN or CNIC for sales to unregistered purchasers etc. They said manufacturers and the general public will get some benefit from these positive moves.

Mian Shaukat Masud said government should announce a special relief package for the revival of industry. He expressed fears that if government did not come forward to rescue the industrial sector, most of the industrial units would default on their payments of loans.

He said economic crisis in the country had made it hard for the industrial sector to operate smoothly and it needed immediate supportive measures on part of government to stand on its own feet.

He said in the forthcoming industrial policy, government must reduce gas and power tariff, oil prices and interest rates due to which many industrial units have closed down in the country.

He said before finalizing industrial policy, government should take all stakeholders including business community into confidence and added that disconnect between the government and the stakeholders always led to great anomalies in government’s business related policies.

He stressed that government should provide R&D support to export-oriented industries for improving country’s exports.