When the political blame game and race for power is continued in Pakistan, the economy of the country has reached to the point where the survival seems quite harder. The prolonged discussion on default has finally entered into the phase where the companies and industries working in Pakistan are continuously closing their operations. Besides this, the basic medicines are also not available in the markets. The foreign currency reserves have come to 5.8 billion dollars which are not enough for trading just one more month.
Operations of a number of industries are being closed. The companies which had come to work in country are closing from Pakistan. Pak Suzuki is the company which is considered as the most favorite car manufacturer in Pakistan as people use their cars more as compare to others. But, Pak Suzuki Motor Company (PSMC) Monday announced that its production plant will be closed completely from January 2 to 6 due to the shortage of inventory level following a restriction on the import of auto parts. PSMC, in a notice sent to the Pakistan Stock Exchange (PSX), said that the State Bank of Pakistan (SBP) has introduced a mechanism for prior approval for import under “HS code 8703 category (including completely knocked down – CKDs) vide circular No.09 of 2022 dated May 20, 2022”. Similarly the other most used brand of cars, Toyota, has already closed its plant from Pakistan. Similarly, the car manufacture company ‘KIA’ which recently got fame in the country has also announced to close its biggest dealership in the country. In an official announcement, Kia Lucky Motor Corporation (KLMC) has announced that one of its dealerships in Karachi is shutting down permanently. The shutdown of the company-operated dealership, Kia Motors Shahrah-e-Faisal, will take effect from January 1, 2023.
Not only the car manufacturers are closing their operations from Pakistan, but all the other industries including textile which is considered as the most beneficial industry is also under a great pressure, therefore a number of textile industries have announced to cut down the production. Nishat Chunian Limited, one of Pakistan’s largest textile companies, informed investors on Wednesday that it was temporarily shutting off some spindles because of market conditions. In a Pakistan Stock Exchange filing, Nishat Chunian Limited (NCL) stated, “The company has an installed capacity of 219,528 spindles and 2,880 rotors in its spinning division. Company has decided to temporarily close 51,360 spindles after one month due to market conditions.” Similarly another big name of Pakistan’s textile industry, Suraj Cotton Mills Limited (SURC)also announced to curtail its productions by 40%. SURC announced the development in its notice to the Pakistan Stock Exchange (PSX). “We would like to inform you that due to the worldwide economic recession and low demand, it is not feasible to continue with full production in our plants.
All the local and international business firms have lost their confidence from Pakistan. The indicators of economy are in front of them. So, they are quite clear that the country is going to default very soon. Therefore, the operations are being closed from Pakistan. One of the reasons is that due to shortage of Dollars imports have been stopped. So, a number of companies are facing acute shortage of important things required for production. The point to consider here is that companies are closing their operations, but political leadership is busy in their race of personal gains. The need of the hour is to impose an economic emergency in the country to avoid expected default in coming days.
Published in Daily Country News, December 31th, 2022.