FRIDAY JANUARY 20: Economy shows strong signs of stability, National Assembly told

ISLAMABAD: Prime Min-ister Yousuf Raza Gilani on Thursday said Pakistan's economy has shown stability and resilience despite global recession and plethora of internal challenges such as war on terror, floods and energy crisis. The Prime Minister said this while giving a policy statement in the National Assembly.
He said that due to sensible economic policies of the present government, it has achieved a number of economic targets during the first six months of the current fiscal year. He said his government inherited a weak economy but it immediately brought down the fiscal deficit from 9.4 to 7.6 percent while the inflation which stood at 25 percent‚ has now come down to single digit ie, 9.7 percent. He said food inflation, which was over 20 percent last year, has also reduced to single digit.
He said the reason for price hike was increase in oil prices in the international market, which on average rose from 85 dollars per barrel to 112 dollars per barrel and till now the government has not transferred the full effects of increase in oil prices to the people. The Prime Minister said that GDP growth rate is expected to remain at 4 percent this year due to prospects of good performance by the agriculture sector. He said cotton production is expected to be 14 million bales.
Gilani said tax collection in first six months of the current financial year increased by 27 percent and the target of Rs 1952 billion for the current fiscal year would be achieved. He said Rs 114 billion have been released for the Public Sector Development Programme (PSDP) while Rs 300 billion have been PSDP allocation for this financial year.
The Prime Minister said under the 7th NFC Award, provinces received resources worth Rs 1000 billion last year and are estimated to get Rs 1200 billion this year against only Rs 670 billion before the announcement of the NFC Award. Despite that, the Prime Minister said that federal government is providing Rs 54 billion additional development funds to provinces. He said with additional resources to provinces, the federal government is providing Rs 70 billion to Azad Kashmir, Gilgit Baltistan and Fata.
He said besides, the government has given various programmes and packages for the progress and prosperity of Balochistan, especially under the NFC Award. He said Balochistan is guaranteed revenue transfer of Rs 93 billion. The Prime Minister said that under 18th Constitutional Amendment the federal government has devolved 17 federal ministries to the provinces.
He said exports in the first six months of the year stood at over $12 billion which is 9.1 percent increase compared to same period last year. He said increase in imports is an important signal in of better economic performance in the country and it will have a positive effect on the GDP growth during the year.
He said the rupee remained stable in the last three years and this stable exchange rate was in the range of Rs 85 to Rs 91. Gilani said Pakistan is also receiving remittances from overseas Pakistanis at an average of one billion dollars a month from July last year‚ which is 19.5 percent up in the first six months.
He made it clear that there was no IMF programme at the moment and the government has not obtained any loan from the Fund since 2010. He said assistance of the World Bank and the Asian Development Bank was normal with a stable balance of payments position. He said the government will repay $1.4 billion of the IMF loan during the current financial year from the budgetary resources, which shows the country's economic strength. The Prime Minister also informed the Lower House of the Parliament that the country received no money under Coalition Support Fund last year.
The Prime Minister also announced that the energy crisis will be overcome within six months. About gas shortage‚ he said the government has to add around 526 mmcfd of gas within next two years, out of which 100 mmcfd has already been provided. He said that one thousand mmcfd would be imported from Iran by 2013. He added that the import would help meet the demand of gas in the country. The Prime Minister said political stability was a must for economic stability and we should all contribute to political stability." About electricity, the Prime Minster said the government has added 3334 MW to the system since 2008.