ISLAMABAD: The Task Force on Private Sector Development, in its report released here on Monday, identified security crisis, extremism, domestic resource mobilization, realistic exchange rate constraints inflation and narrow industry base as the top most challenges for national economy.
The task force was formed as a forum of public-private dialogue consisting of 29 leaders from government, business, civil society and academia pressing economic problems of the country and role of the private sector to steer the economy out of crises.
On macro side challenges like saving investment gap, external shocks like security situation, inadequate public policy changes in the current scenario were underlined.
The report identified the key binding constraints to private sector led growth which include low domestic savings and vulnerability to external shocks, low skills and absence of a competitive human resource base and inward orientation of firms and low technology content.
The poor quality of infrastructure like power, transport, poor governance, deteriorating institutions, opaque legal and regulatory frameworks.
The task force in its findings asked for rationalization and expansion of the fiscal base with the goal to increase tax to GDP ratio from the current 9 percent to 17 percent over a period of 5 years.
It asked for developing an institutional and analytic framework to guide the process of fiscal decentralization and removing the anti export bias in the management of the economy and move towards export led growth.
The report asked for implementing a well financed program to improve and develop the infrastructure base of the economy, improving educational and skill base for the economy by setting up institutional mechanism for implementing the recommendation of the task force in overseeing the process of implementation.
The report also emphasized that in order to take action on the agenda developed by the task force the government with the help of the donor community should undertake the initiatives as next steps by reviewing of the trade policy with a view to placing greater focus on export-led growth, inventory of subsidies granted to the private sector with a view to their rationalization.
It also asked for launching a public awareness program to create a constituency for reforms leading to a new social compact for the country.
Speaking on the occasion, Deputy Chairman, Planning Commission Dr. Nadeem-ul-Haq stressed on transformation of economy from state managed to private sector driven growth strategy, with market reforms, privatization and institutional restructuring in order to re-direct economy toward a fast growing economy.
He also emphasized the role of state, in future, to be a facilitator rather than a regulator. Fact remains that private sector without right set of public policies human capital and improved governance, can not bring efficiency and growth in the era of global competitiveness, he said as well.
Hence, Deputy Chairman expressed that a paradigm shift is required from project based approach in the bureaucratic and political circles to reform based approach so as to enhance productivity and accelerate GDP.
Likewise he observed that an intellectual movement led by forward looking think thank is essential to develop consensus for reforms among all stake holders in order to put Pakistan economy on sustained growth trajectory.
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