LAHORE - Heavy dependence on foreign and domestic loans, high markup rate, unavailability of gas and uneven economic business policies are fast pushing the economy to the wall and unless the government evolves a solid strategy to rejuvenate business and economic activities in the country, the situation would remain the same for years to come. This was revealed in an analytical report issued by Pakistan Industrial and Traders Associations Front (PIAF) Think-Tank here on Friday. The Report pointed out that it was very unfortunate that despite repeated appeals by the business community, the State Bank of Pakistan had raised the discount rate by 50 basis points thus making the equity further dearer for the people who want to initiate new ventures. According to the report, the rate of interest in Pakistan was the highest that was not only creating troubles for the manufacturing sector but was also hitting the exports badly. The interest rate in US is 0.25 per cent, in UK 1.5 per cent, in Canada 1.5 per cent, in Australia 4.25 per cent, in Japan 0.1 per cent, in China 5.58 per cent, in India 5.5 per cent and in Bangladesh 7.61 per cent. The report suggested to the government to immediately bring down the markup rates to single digit to support the textile sector which makes to 60 per cent of total export earnings. The report invited the attention of the government towards deteriorating law and order situation which is discouraging both the local and foreign investors to put their money in any new venture. The atmosphere of distrust prevailing at political front also needs to be taken care of as it was unduly vitiating the economic scenario and sending a very wrong signal abroad, the report added. About RGST, the report revealed that despite serious business community reservations, the govt was adamant to impose it that makes the point that the government was unaware of the ground realities regarding the business situation in the country. The report termed the RGST as anti-people, anti-business and anti-investment bill that would open the doors of corruption. He urged the government to withdraw the bill and continue with zero-rating regime for all the products and raw materials of five export sectors. The removal of zero-rating facility would hurt the export sector due to increased liquidity requirement. The Reformed General Sales Tax was another name of VAT and its implementation would have serious and negative impact on industries and prices of goods would sky rocket. Implementation of RGST will increase corruption manifold. food inflation which is 40 percent at present will increase tremendously with the enforcement of RGST. The new taxation measures would also be putting an extra pressure on already taxed people.Instead of widening the tax net and bringing the untaxed sectors into tax net, the government had taken the other way of squeezing those who were already in the tax net and paying all government dues regularly.