Businessmen reject both budgets
After condemning both the federal and Sindh budgets for 2025-26, business leaders called for mandatory amendments before their approval.
They said neither budget fulfills serious commitments nor offers direct financial relief to micro and small businesses. They demanded substantial revisions to increase allocations for Karachi-centric development projects. The prosperity of Pakistan is tied to Karachi's, they said, warning that neglecting the city amounts to sabotaging the national economy.
Businessmen Group (BMG) Chairman Zubair Motiwala and Karachi Chamber of Commerce and Industry (KCCI) President Muhammad Jawed Bilwani blasted the federal and Sindh budgets for sidestepping Karachi's needs. Condemning the budgets as deeply disappointing and discriminatory towards Karachi, the country's economic hub, they expressed serious concern over the continued neglect and denial of essential development funds to Karachi and Sindh at large.
Motiwala and Bilwani warned that chronic underinvestment and token budget allocations will worsen the city's infrastructure, civic conditions, and business confidence.
They stressed that Karachi contributes 67% to the national exchequer, 90% to the provincial revenue, and 54% of the country's exports. Denying it fair development funds is not just a regional injustice but a national threat, they lamented. They called on both the federal and provincial governments to revise their priorities and ensure Karachi receives its due share. The time for symbolic allocations is over. Karachi's citizens and business community now demand concrete action, adequate funding, and political will.
The two leaders also highlighted underfunding of the Sukkur-Hyderabad Motorway, a key project for Sindh and Karachi's connectivity. Though the project's cost exceeds Rs400 billion, the federal budget allocates only Rs15 billion — an amount they said reflects disregard for Sindh's development priorities.
Karachi, Pakistan's commercial capital, would benefit directly from the project's completion, making the lack of funding more concerning. Similarily, they pointed to the stalled K-IV Water Supply Project. Despite being critical for a water-starved Karachi, the project remains in limbo.
Though top officials, including the prime minister, have repeatedly promised support, the federal government has allocated only Rs3.2 billion of the Rs150 billion needed.
This minimal allocation, they said, casts doubt on the government's seriousness about solving Karachi's water crisis.
KCCI leaders expressed disappointment with the Sindh Budget 2025-26, saying the provincial government has also failed to address Karachi's needs. In its development outlay, the Sindh government allocated only Rs100 million for the K-IV project and Rs15 billion for the Sukkur-Hyderabad Motorway — amounts they called meaningless for project execution.
Alarmingly, they said, this marks the third year without a single new mega project for Karachi. The only move was an Rs8 billion allocation to continue earlier projects, most of which are progressing at a snail's pace. They criticised the ongoing delay in the K-IV project. Despite growing water demand, the city's main lifeline remains stalled. Meanwhile, millions of gallons are wasted and discharged into the sea, while residents and industries suffer water shortages.
Federal B Area Association of Trade & Industry (FBATI) President Shaikh Muhammad Tehseen also criticised the inadequate allocations by both governments for Karachi's industrial sector, infrastructure, and water projects.
The budget reflects no serious effort to resolve chronic industrial issues such as crumbling infrastructure, water scarcity, and power instability — all of which undermine productivity and investor confidence, he said. He urged both governments to revisit their budgetary decisions and allocate sufficient resources to support the revival of the industrial sector. Former president of the Hyderabad Chamber of Small Traders & Small Industry (HCSTSI), Muhammad Farooq Shaikhani, said the federal budget includes digital reforms and SME policy initiatives that sound good on paper but offer no direct financial relief for micro and small businesses.
He said the new taxes on digital services and cash-on-delivery (COD) are premature and will burden small enterprises. While the Sindh budget includes funds for infrastructure and social sectors, it does not prioritise industrial zones or SME support.
Both budgets, he said, focus on macroeconomic goals but ignore grassroots business sustainability. There is a clear gap between the government's documentation drive and the actual incentives offered to small traders and manufacturers.
Shaikhani added that both budgets fail to create a conducive environment for small businesses.
The federal budget introduces new taxes — on digital services, cash on delivery (COD), and higher withholding rates — without providing simplified schemes or financial support for small enterprises. The Sindh budget also neglects trade infrastructure and offers no tax relief or subsidies for SMEs. It fails to address the rising cost of energy and unaffordable raw materials, he said.
Without practical incentives or consultations with affected sectors, both budgets appear more focused on revenue collection than on industrial or trade development, he added.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Express Tribune
11 hours ago
- Express Tribune
PAC blows whistle on Rs40b Kohistan scam
The Public Accounts Committee (PAC) on Wednesday held a detailed discussion on the alleged Rs40 billion scam in Kohistan, expressing serious concerns over financial irregularities and a lack of departmental cooperation. Chairing a meeting after a month-long break, PAC Chairman Junaid Akbar said that when the committee raises audit objections, the department concerned fails to cooperate effectively. In May, the Khyber-Pakhtunkhwa government launched an investigation into the mega corruption scandal in Kohistan district, where an estimated Rs40 billion had allegedly been siphoned off from the provincial treasury. The account was meant for retention money by contractors for schemes of four departments including communication and works, local government, irrigation and public health engineering departments. The scandal came under intense scrutiny during a meeting of the PAC, chaired by K-P Assembly Speaker Babar Saleem Swati. Officials from the finance department and the Accountant General's office admitted during the session that billions had been misappropriated from government funds. While an official embezzlement figure of Rs24 billion had been confirmed, the PAC members expressed dissatisfaction with the explanations provided by finance secretary and the accountant general. On Wednesday, the audit officials revealed that there had been a misuse of cheque book, with fraud committed by three individuals who have now been arrested. The National Accountability Bureau (NAB) is currently investigating the matter. The auditor general disclosed that despite sending three letters to the finance department, no disciplinary action had been taken against any of their officials. The committee demanded complete details of the case and directed that all relevant records be submitted.
Business Recorder
13 hours ago
- Business Recorder
Small traders reject hike in rates of fuel prices
KARACHI: The All Pakistan Organisation of Small Traders and Cottage Industries, Karachi chapter on Wednesday come out strongly against the government's recent increase in fuel prices, condemning it as an 'anti-trader, anti-economy' decision that will only deepen the crisis already engulfing Pakistan's commercial capital. Led by their President, Mahmood Hamid and senior leadership including Syed Liaquat Ali, Javed Haji Abdullah, Naveed Ahmed, and Usman Sharif, the body rejected the hike of Rs8.36 per litre in petrol and Rs10 in diesel, calling for its immediate reversal. The leaders described the move as a cruel blow delivered just a day after the imposition of Rs463 billion in new taxes through the federal budget. 'This shameful fuel price hike will paralyse the economy,' they warned. 'It will raise transport and logistics costs, trigger fresh waves of inflation, and make business operations unaffordable—pushing both ordinary citizens and small traders to the brink.' They painted a bleak picture of Karachi's civic landscape, already reeling from post-monsoon neglect. 'Markets are submerged in filth, with stagnant water still not drained. Roads across commercial centres look like archaeological ruins, battered by decades of neglect. Power outages are routine, and K-Electric's excessive billing and poor service have become unbearable,' they said. According to the traders, the sudden spike in fuel prices will only exacerbate these conditions, as transportation of goods becomes costlier, shop rents soar due to electricity adjustments, and consumers cut spending amidst rising living costs. In particular, they took strong exception to Section 37AA of the new budget, which empowers tax officials to detain traders and recover taxes directly from their accounts. Terming it 'draconian and disgraceful,' the leaders said it violates constitutional protections and business ethics. 'The tax net cannot be expanded by treating traders like criminals,' they said, warning of a citywide protest movement if the clause is not withdrawn. The traders dismissed gains in the stock market as 'artificial window dressing,' saying real economic progress is impossible without structural support for the business community and proper civic governance. 'Karachi is the backbone of Pakistan's economy, but it's being choked with taxes, fuel hikes, and criminal neglect. This cannot continue. We demand that the government stop punishing the city that pays the country's bills,' the statement concluded. Copyright Business Recorder, 2025
Business Recorder
13 hours ago
- Business Recorder
Nepra rejects govt plea to apply revised SoT to KE
ISLAMABAD: National Electric Power Regulatory Authority (Nepra) has turned down the federal government's plea to apply a revised uniform Schedule of Tariff (SoT) to K-Electric (KE), based on the previously determined tariff for the January–March 2023 quarter— a move likely to frustrate the Power Division. Nepra's decision was revealed in a determination issued on Tuesday, which outlines a revised average uniform SoT of Rs 31.59/kWh for both power Distribution Companies (Discos) and K-Electric for the fiscal year 2025–26. This rate marks a reduction from the earlier Rs 32.73/kWh (excluding duties and taxes), reflecting an average decrease of Rs 1.14/kWh after factoring in a budgeted Tariff Differential Subsidy (TDS) of Rs 250 billion for FY 2025–26. In its formal request (Motion for Leave), the Power Division argued that under government policy, a uniform consumer-end tariff should be maintained across K-Electric and state-owned Discos— even post-privatisation— through a mix of direct and indirect subsidies. To achieve this, the KE tariff should be modified to align with Nepra's approved national uniform tariff structure, incorporating the proposed targeted and cross subsidies. DISCOs and KE: Nepra approves revised average uniform SoT The Power Division also referenced legal provisions— Section 7, 31(4), and 31(7) of the NEPRA Act and Rule 17 of the relevant rules— supporting its appeal for revised consumer-end tariff recommendations for K-Electric, to be effective from July 1, 2025. The motion included a request to update the SoT via an amendment to SRO No. 575(1)/ 2019. During the hearing, K-Electric's Director of Finance Ayaz Jaffer urged Nepra to use KE's most recent tariff (determined on May 27, 2025) instead of the older Jan–Mar 2023 rates to establish the uniform tariff. However, Naveed Qaiser of the Power Planning and Monitoring Company (PPMC) opposed the suggestion, pointing out that the federal government has already filed a review petition against the newer KE tariff determination. Therefore, he argued, the Jan–Mar 2023 tariff should be treated as the valid benchmark. The Authority said it understands that it determines revenue requirement/ tariff for Discos for each year. Ultimately, Nepra decided not to accommodate the Power Division's request. In its official determination, the regulator stated that despite the federal government's plea to use the Jan–Mar 2023 KE tariff as the basis for a uniform SoT, it opted to apply the rates from KE's latest approved tariff for FY 2023–24, as issued on May 27, 2025. Nepra announced a reduction in the uniform average tariff from Rs 35.50/kWh to Rs 34/kWh, indicating an overall decrease of Rs 1.50 per unit. The revised SoT for consumers will be as follows: (i) up to 50 units– lifeline (Rs 3.95/kWh;(ii) 51-100 units- lifeline Rs 7.74/kWh;(iii) 0-100 (protected) Rs 10.51/kWh;(iv) 101-200 (protected)Rs 13.01 /kWh; (v) 01-100(non-protected) Rs 22.44/kWh; (vi) 101-200(non-protected) Rs 28.91/kWh;(vii) 201-300(non-protected Rs 33.10/ kWh; and (viii) 300 & ToU (non-protected) Rs 41.78/kWh. Average uniform domestic tariff will be Rs 27.20/kWh with reduction of Rs 1.13/Kwh from 28.33/kWh. New commercial tariff has been fixed at Rs 45.43 per unit with a reduction of Rs 1.15/Kwh, general services, Rs 43.17/kWh, industrial Rs 33.48/kWh, Bulk Rs 41.76/kWh, agricultural Rs 30.75/kWh, others Rs 32.68/kWh. According to Nepra, total number of electricity consumers is 37,994,210 who are projected to consume 103,558/MkWh. The average tariff has been reduced to Rs 31.59/kWh for FY 2025-26 from Rs 32.73/kWh through re-basing. Power Division explained that capacity charges have been reduced by Rs.186 billion, despite additional impact of Rs.50 billion capacity charges of Jamshoro Coal Plant, as compared to the reference capacity charges for the FY 2024-25. This reduction is mainly on account of termination/ re-negotiations of IPP contracts and change in exchange rate assumption. The Authority also observed that the petitioner in its Motion and also during the hearing submitted that inter-disco tariff rationalisation is not aimed at raising any revenues for the federal government as it is within the determined consolidated revenue requirement of all the Discos for the FY 2025-26; rather the federal government would be providing a subsidy of Rs.249 billion to different consumer categories during the period. The Uniform Tariff so determined by the Authority includes impact of PYA of Rs.58.68 billion, to be passed on in a period of twelve months from the date of notification of the decision. It was further stated that there is no anomaly in the current industrial tariff structure as the total cost of B4— inclusive of both fixed and variable charges—is actually lower than B3, which is again lower than B2. This reflects the benefit of losses for consumers connected at high tension (HT) lines, as opposed to industrial consumers on low tension (LT) lines. It was explained that ToU (Time-of-Use) pricing plays a critical role in maintaining power system stability and economic efficiency. Peak hours are strategically designated to curb demand during periods of high system stress when marginal generation costs are at their highest. However, lowering the peak rate would necessitate an upward adjustment of the off-peak rate to meet the system's annual revenue requirement. This could disproportionately burden smaller industrial consumers and potentially reduce overall electricity sales, thereby exacerbating the revenue shortfall and contributing to further upward pressure on tariffs. Copyright Business Recorder, 2025
