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ISLAMABAD: The Economic Advisory Council (EAC) is to propose establishment of a private equity fund by DFIs to help consolidate industry and bring in Foreign Direct Investment (FDI) to buy them, well-informed sources told Business Recorder. The launch of the second phase of China Pakistan Economic Corridor (CPEC) is also on the proposed agenda of the Council. For this purpose, the Council will identify key investments both in public and private sectors to be undertaken in CPEC phase two. It will also consider measures to populate the Special Economic Zones (SEZs), especially with Chinese investment. Efforts will be made to also tap South Korea, Japan and Non Resident Pakistanis (NRPs).

Addressing the maiden meeting of EAC, Finance Minister, Shaukat Tarin had said that the role of EAC will provide an opportunity to contribute to national agenda and share the ideas and experience for making national policies. He explained the objectives of EAC particularly in the backdrop of economic challenges faced by the country. He highlighted the need for developing appropriate policy recommendations to promote inclusive and sustained economic growth. He further guided the participants that the EAC should prioritize suggestions for short-, medium- and long-term basis and list the steps which can bring immediate results by picking the low hanging fruits.

He further explained that EAC should work in various thematic groups so that each group may come up with focused set of recommendations for short-, medium- and long-term measures. He mentioned that initially l2 thematic groups have been proposed in the working paper shared with the participants. The members are free to choose any one or more than one working group and select their group's convener among themselves. He emphasized that each group should prepare its recommendations and action plans in consultation with relevant stakeholders and those suggestions which require short-term budgetary interventions should be finalized within the next 2-3 weeks so that appropriate budgetary allocations can be considered for earmarking for the purpose. The road maps prepared by each group shall be presented to the Prime Minister for his final approval and thereafter monthly progress report shall also be submitted to the Prime Minister.

The following proposals and suggestions were made by various participants for further improvement in the expected outcome: (i) a specific working group on lT may also be established besides domestic commerce keeping in view the high growth potential of these services in the short to medium term. The proposal was agreed and appreciated by all the participants; and (ii) the working groups may be headed by private members of each group instead of the relevant Ministers. After a good deal of discussion on the proposal, it was appreciated that while private members would bring new ideas and out of the box thinking, as a rule, it would be more effective to have a Minister as the convener of each group to ensure stronger ownership of the outcome in internal deliberations. In case the Minister in Charge so decides the private member would head the group.

It was also decided that the provincial governments should also be represented in the EAC as the provinces are major players in the overall economic governance framework as well as in public sector spending decisions.

It was acknowledged that provinces were an important stakeholder and consultations with them would enrich the proceedings of EAC. All Finance Ministers would be requested to take part in the proceedings of EAC as per their convenience. However, in the working of thematic groups provincial representation at the appropriate level would be requested from the concerned Finance Minister/Chief Secretary. The proposed ToRs of various thematic groups need slight modifications and improvements.

It was agreed during the discussion that the draft ToRs shared in the working paper for each thematic group are tentative in nature. Each group may send their recommendations to EAC Secretariat for consideration.

The sources said that in addition to the issues highlighted in the ToRs of the proposed thematic groups, there are several cross-cutting themes like employment, gender, productivity and skills' development etc. It was agreed that cross-cutting themes like skills development, employment generation, gender, productivity and competitiveness etc. shall be examined by each thematic group as they relate to the scope of their work.

Dr Waqar Masood Khan, SAPM on Revenue, made a detailed presentation on the medium term goals that could be achieved against various thematic areas in the next 30 months. The proposed work-plan was appreciated and considered as a good starting point on which the thematic groups could further deliberate to build on their detailed recommendations and action plans.

Prime Minister Imran Khan joined the meeting one-and-half hours late. He explained that the highest priority for his government at this stage was to provide maximum relief to the people particularly through price stabilization and by providing economic opportunities. Finance Minister briefed the Prime Minister about the deliberations of EAC and highlighted the important role the forum was expected to perform in designing policies and plans to ensure sustained and participatory growth in the country. The Prime Minister thereafter heard the views of various private members of EAC. He encouraged the members to bring in new ideas which would ameliorate the conditions of weaker segments of society, particularly at a time when the country was struggling with the third wave of covid-l9. He added that the country cannot bear the burden of higher taxes and rising inflation so policies must have a bias towards relief and support to the poor.

The Finance Minister assured the Prime Minister that the thematic groups would be bringing their recommendations for policy actions within one month and will present those for Prime Minister's consideration and approval.

Copyright Business Recorder, 2021

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