Government trying to bring down fiscal deficit: National Assembly told

Minister of State for Production Khawaja Sheraz Mahmood on Wednesday said that the government is trying to bring fiscal deficit to 5.5 percent of Gross Domestic Product (GDP) at the end of the current financial year. Responding to various questions of the Parliamentarians in the National Assembly, he said that the government is trying to bring down fiscal deficit to 5.5 percent of GDP.
He said that the economic situation of Pakistan is badly affected due to global financial crunch. But, now the economic situation of the country is improving with the passage of time. Replying to a question on behalf of the Finance Minister, he said presently no proposal was under consideration to reduce the interest rate to a single digit and low mark up rate to provide easy credit facility to the high potential industries in the country.
He said rates were determined by an independent auction process of the government securities and the policy rate of the State Bank of Pakistan keeping in view inflation and growth targets. However, he said, the interest rate would come down as inflationary pressure subside, for which the government was taking all necessary steps including reduction in fiscal deficit and its financing from non-central bank sources. Answering to a supplementary question, the Minister admitted that the rural economy of the country has been neglected while its improvement could have better effect on the GDP.