KARACHI: FPCCI President Mian Nasser Hyatt Maggo has noted with concern that commercial banks continue to disburse 90 per cent of the funds– coming under export refinance schemes of the State Bank of Pakistan– to only a few chosen business groups.

The whole exercise is biased and unfair, it said, adding that the same practice has continued with respect to export refinance for solar plants and equipment, FPCCI, an apex representative body of traders, said.

Maggo said the Small and Medium Enterprises (SMEs) will not be able to remain in business and survive in these times of depressive pandemic-induced economic slowdown if the practice continued.

Maggo noted that economic logic warrants more support to SMEs and new businesses rather than well-established business groups. This is even more critical with clean energy sources, like solar energy, as Pakistan desperately needs more businesses to chip in.

FPCCI maintained that the federal government and the state bank should accommodate and encourage SMEs in export refinance schemes. Additionally, SBP should instruct commercial banks to provide funds to diversified sectors under the schemes instead of a few selected sectors.

It said Pakistan needs a broadening of the base in its exports and the government and SBP have a role to play. The SBP must regulate the commercial banks effectively to eradicate favoritism and unfair practices, the press release concluded.

The writer is a member of staff
The reporting desk can be reached at info@thecorrespondent.com.pk

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