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Chambers of commerce

Business Communities in Pakistan's Largest Cities Partially Close in Strike Against Finance Act Provisions

Strategic Insights

— 2 min read

Thousands of business hubs, markets, and petrol stations in Karachi and Lahore, Pakistan's two largest cities, partially closed on Saturday due to a strike called by the Karachi and Lahore chambers of commerce against changes in the Finance Act for FY2025-26. The strike was later described as 'symbolic' by the government, following successful negotiations with trade bodies. Special Assistant to the Prime Minister for Industries and Production Haroon Akhtar Khan stated that the government had a detailed discussion with representatives from different trade bodies, including the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), where it worked on the draft to accommodate trade bodies' demands.

Key Takeaways:

  • The strike, called by Karachi and Lahore chambers of commerce, was in response to changes in the Finance Act for FY2025-26 that expanded the powers of the Federal Board of Revenue (FBR), introduced steep penalties on cash transactions exceeding Rs200,000, and enforced digital invoicing via SRO 709.
  • The business communities in Karachi and Lahore, which collectively account for over 60% of Pakistan's economic output, were partially affected by the strike, with major commercial centers, industrial zones, and residential areas shutting down or partially closing.
  • Industrial activity in Karachi's seven major zones was affected, with 20-30% of units in Korangi closing in the morning but reopening for the second shift, while approximately 70% of units in SITE were shut, though export-oriented businesses remained functional.
  • The government has added at least seven layers of monitoring and checks to prevent any misuse of the powers granted to the FBR, and has agreed to strike down a clause that allows the FBR to arrest an individual if it fears that the accused will abscond.
  • Tensions arose within the business leadership, with Lahore Chamber of Commerce and Industry (LCCI) President Mian Abuzar Shad calling for the resignation of FPCCI President Atif Ikram Sheikh, citing dissatisfaction over his handling of recent negotiations with government officials.
  • The LCCI has invited traders to a meeting on July 23 to determine the next course of action, while the KCCI President Mohammad Javed Balwani expressed gratitude to the business community for supporting the strike and urged the government to engage in constructive dialogue.

Statistics:

  • The strike affected thousands of business hubs, markets, and petrol stations in Karachi and Lahore, causing partial closures in major commercial centers, industrial zones, and residential areas.
  • Approximately 20-30% of units in Korangi closed in the morning but reopened for the second shift.
  • Approximately 70% of units in SITE were shut, though export-oriented businesses remained functional.
  • The government has added at least seven layers of monitoring and checks to prevent any misuse of the powers granted to the FBR.
  • The LCCI has invited traders to a meeting on July 23 to determine the next course of action.

Sources:

  • Geo News
  • Programme 'Naya Pakistan'
  • Federation of Pakistan Chambers of Commerce and Industry (FPCCI)
  • Lahore Chamber of Commerce and Industry (LCCI)
  • Karachi Chamber of Commerce and Industry (KCCI)

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