ISLAMABAD

The Union of Small and Medium Enterprises (UNISAME) has drawn the attention of the federal finance minister Ishaq Dar to the proposals submitted to his ministry for putting the economy on the right track through SME friendly policies.
In a press release issued on Sunday, UNISAME President Zulfikar Thaver said the SME sector constituted a major chunk of the country’s economy, and unless the policy makers focused on the primary, secondary and the services sectors, the economy would not grow. “The government cannot afford to neglect the micro and SME sectors,” he opined.
Thaver also stressed the need for adopting modern banking, leasing, insurance and logistics. “UNISAME has submitted long and short-term measures for making the SMEs competitive, efficient and growth-oriented,” he said.
He appreciated the efforts of the State Bank of Pakistan (SBP) for making financing affordable, but regretted that it was not accessible. “To make it accessible, the sector needs SME specific bank with countrywide branches.
He also asked the commercial banks to take interest in the SME sector, too. “The commercial banks are inclined to fund the public-sector enterprises, but not the private-sector ones,” he complained.
Underscoring the need for providing an enabling environment to banks for financing the SMEs, Thaver said SME Credit Guarantee Insurance institutions needed to be strengthened.
“The sector is awaiting the much talked about and much promised Exim Bank, and the UNISAME has urged the SBP to expedite the process of its establishment so that international trade could be facilitated,” UNISAME president added.
Thaver said the banks were not interested in financing exports to the third world countries and letter of credits (L/C) of opening banks of low ratings.
He deplored that small entrepreneurs were not accommodated by the commercial banks, and it was, therefore, proposed to enhance the credit limits of the micro finance banks from Rs 500,000 to Rs 1 million.
UNISAME president also pointed out that the SMEs needed modern logistics, including transportation, insurance cover for goods in transit, warehousing with collateral management and risk management. “Commercial property leasing and pay as you earn schemes are need of the hour,” he asserted.
He also pointed out that Pakistan was importing many items, which were or could be manufactured in Pakistan, adding, “It is painful to see confectionery, stationery, furniture, clothing, jewellery, cosmetics, electrical and light engineering goods, footwear and food items being imported.”