Pakistan’s economic sector had comfortably stabilised: Hafeez Shaikh

ISLAMABAD: The Prime Minster’s adviser on finance and revenue, Dr Abdul Hafeez Sheikh, said Monday  Pakistan’s economic sector had comfortably stabilised now — something that international institutions, including the International Monetary Fund (IMF) and the World Bank, have also endorsed.

“Last week, the IMF had praised Pakistan government’s efforts of introducing reforms in economic sector and said that it had met all the targets that were set by the IMF for its programme with the country,” Dr Sheikh said during  a press conference here in the federal capital.

The PM’s adviser explained that after successful dialogue with the IMF, it had also approved release of second tranche worth $450 million to Pakistan.

In addition, the Pakistani government has decided to announce a Rs200-billion package for the exporters to promote exports besides increasing production and job opportunities in the country.

Speaking alongside the PM’s special assistant on information, Dr Firdous Ashiq Awan, Economic Affairs Minister Hammad Azhar, and Federal Board of Revenue (FBR) Chairperson Shabbar Zaidi, the adviser said the State Bank of Pakistan (SBP) had also decided to increase loans for the exporters by Rs 100 billion.

Dr Sheikh informed that the government had also decided to allocate additional Rs 250 billion to resolve the problem of circular debts in the country’s power sector.

The government, he said, had also allocated an amount of additional Rs 30 billion for ‘Naya Pakistan Housing Scheme’ to be utilised in term of various subsidies to be given to the builders. The stakeholders involved in construction sector would also be given special tax concession, he added.

Dr Sheikh said the government, during first four months of the current fiscal year, had achieved remarkable successes on economic front as the trade deficit continued to reduce resulting in increase of foreign exchange reserves in the country.

He said after a big gap of five years, the country’s exports had started increased four percent and that the FBR tax revenues had also grown 16 percent in four months compared to same period of last year.

The adviser on finance pointed out that cement production also increased 4.5 percent, which was evident of the fact that the country’s construction sector was growing.

“The country’s exchange rate remained stable during first four months of fiscal year 2019-20 and stock market had also shown a remarkable recovery,” he said adding the government had paid $2.1 billion debts obtained by the previous government.

In response to a question, Dr Sheikh said the pace of Pakistan’s economic growth would increase further in the coming days and that the government’s target for fiscal year 2019-20 could easily be surpassed.

The adviser also noted that the government had allocated record Rs 152 billion for the development of erstwhile FATA during current fiscal year.

In response to a query on the discount rate, Dr Sheikh said the determination of discount rate was the monitory policy committee’s job and the government had given full independence to the SBP’s monetary policy. The committee determined the discount rate by keeping in view various factors, he mentioned.

The adviser said the government was fully focused on controlling the prices of daily use essential items. “We are also taking steps to minimise the role of middle men due to which the price of food items jumps when they reach the end consumers.”

He said the government had also decided not to borrow money from the SBP, due to which Pakistan did not print even a single rupee during last four months. The government, he added, had also decided to provide Rs 6billion to utility stores to ensure availability of essential daily use items on subsidised rates.

To a query, he said the previous government wasted $20-25 billion of the nation only to artificially maintaining Pakistan rupee’s exchange rate against US dollar. For the past four months, the petrol prices were not bumped up despite the fact that prices in the international markets had increased.