The opening up of foreign companies in Pakistan is having a negative impact on the economy. According to a report by the State Bank of Pakistan, these companies have sent back almost $201 billion in 2016-17. This is a lot of money going out of the economy, which is already facing a current deficit of $12billion.

The amount of profit that these companies earn annually has been increasing in the last couple of years. The amount of reverse remittances almost equals the Foreign Direct Investment (FDI) that Pakistan manages to get. This outflow has neutralised the impact of the FDI; a result of which is that we have not been able to control falling remittances and the deficit.

Despite an increase of $2.4 billion in FDI in the last fiscal year, the amount is still negligible if you compare it with regional countries like India and China. The debt increases every fiscal year, and is categorised as one of the biggest economic challenges by the State Bank of Pakistan (SBP). This is so because the reserves of SBP are falling and are not able to cover the discrepancies.

The irony is that the government still portrays the situation as positive and something manageable. Economists and financial experts have issued several warnings against reverse remittances, and no strategy has been devised so far to deal with the problem. The result of this is that several companies operate without any scrutiny and get away scot-free after causing damage to the economy.

Several foreign nationals have been granted entry into Pakistan on business visas and have taken advantage of the leverage offered to them. Interior Minister, Chaudhry Nisar, has ordered the Securities and Exchange Commission of Pakistan (SECP) to conduct an audit of all foreign companies to point out those who are not filing tax returns, and those involved in unauthorised activities.

A foreign company must get itself registered to SECP before operating in Pakistan, and individuals must be properly scrutinised before being offered visas. This step has been taken after a couple was kidnapped and murdered by the IS in Quetta for preaching Christianity, instead of running a business.

The Federal Investigation Agency (FIA) will also launch an investigation against the ignorant officials of the SECP, who fail to implement the legal procedure and fail to perform their duties. This is a great step indeed, because it ensures functioning of the institutes on both levels and increases the accountability of the foreign companies and nationals that enter Pakistan.