ISLAMABAD: Finance Minister Shaukat Tarin Wednesday said the International Monetary Fund (IMF) board of directors meeting has been delayed till February 2 for the approval of 6th review on the request of Pakistan.
Addressing a press conference, the finance minister said that as the SBP proposed amendment bill has not yet been approved from the Senate, few more days have been sought from the Fund’s board meeting as per previous schedule the law should have been passed from the Senate on Wednesday.
He said that the government would get the law passed from the Senate in the next few days.
The finance minister also highlighted challenges and stated that the increase in prices of utilities would reduce their deficit and there are apprehensions of increase in inflation.
The finance minister said that the prime minister’s decision not to go for total lockdown of the country during the Covid and support the people through Ehsaas programme and incentivizing the industries and agriculture contributed to the growth. He said that 2021 growth prior to rebasing has been 5.37 percent as a result of these measures and if rebasing figures are taken then the growth would be 5.57 percent.
The Economist put Pakistan for the three times in its three index and now even developed countries like UK has started stating that they would not lockdown.
He said that cycle of commodity prices is the second challenge for the government as three to four prices have increased 86 to 90 percent, oil prices edible oil, coal, and pulses and some of them have increased more than double.
These commodities’ imports have led to inflation and increase in trade deficit as petrol import is $10 billion and similarly edible oil.
However, he said that the country’s exports have increase subsequently international reserves were not affected.
He said that Afghanistan crisis is another challenge for the government and now the government is taking measures of barter trade and import from Pakistan by Afghanistan in rupee instead and maintained that the government is trying to handle the situation because it was putting pressure on the exchange rate.
He said at a time a significant amount of US dollars were going to Afghanistan and the government has taken preventive measures.
The bottom line is that growth is increasing and is expected to be around 5 for the current fiscal year, while the State Bank of Pakistan (SBP) is projecting 4.5 percent. I believe the country would be growing at around five percent for the current fiscal year because revenue are record high, electricity consumption is more than 13 percent and exports, which were monthly $2 billion are now $3 billion and will touch $31 billion level excluding $ 3.5 billion exports of IT sector.
The finance minister said that the remittances are robust and are over $15.8 billion.
The finance minister said that machinery imports have increased $11.8 billion in 2021 and private sector off take was highest Rs1.45 trillion all inclusive and the government borrowing is zero during the last three years instead government returned Rs1.5 trillion to the SBP. Corporate profitability is highest and agriculture sector all the crops are better than previous year, he added.
The finance minister said that we have started monthly disbursement of Rs1,000 through Ehsaas ration card to 20 million households for three commodities.
Tarin said Kamyab Pakistan Programme has started taking off and Rs1 billion has been paid in the last month and decided to take it gradually to Rs30 billion per quarter.
He said that the salaried class is in trouble and urban lower and middle class is suffering and the government is making programme to target as government does not know when the super commodity cycle would ease. Economy is moving in the right direction and now the challenges are being tackled and the way to help the people suffering, he added.
Replying to questions, he said that discussion with the SBP would be held with regards to not to treating the government as it is treating the other commercial debt.
The minister said that the government wanted to use the increase in income in innovative way to help the people with minimal impact on the deficit.
About perception that corruption has increased in Pakistan, he said eight agencies have commented on it and seven have placed it on the level of previous year and Economist Intelligence Unit score was 37 last year and it has been now placed at 20.
The finance minister said that the prime minister has ordered an independent inquiry against his own people and got them indicted and as far as rule of law is concerned, there is different law for the rich and poor.
He said that when the total details of the survey would be available, the government would respond to it.
He said that total import would be reduced significantly and the government would bring the current account deficit down.
He also said that saving and investment was important and deplored that not a single dollar foreign investment came to exporting sectors.
The finance minister said that total imports of the country would be substantially less in the current fiscal year and current account deficit would be brought down.
The minister said that China would be requested to relocate its industries to Pakistan.
Copyright Business Recorder, 2022