ISLAMABAD – Prime Minister’s Advisor on Finance Dr Abdul Hafeez Shaikh sayshandling current account deficit, strict austerity measures, helpingdowntrodden, facilitating industry, and mobilizing revenues are the fivefundamentals of next year’s budget.
He was addressing a news conference, flanked with Prime Minister’s SpecialAssistant on Information Dr Firdous Ashiq Awan, Minister of State forRevenue Hammad Azhar, and Chairman FBR Shabbar Zaidi in Islamabad thisafternoon.
The Advisor said Pakistan’s total debt was reached to about 31,000 billionrupees, whereas the foreign loans had touched the figure of 100 billiondollars. There was a great stress on Pakistani rupee due to growing gapbetween exports and imports. He said several measures have been proposed inthe new budget to control this external threat. He said tariffs wereimposed to decrease imports, which will continue in the next budget aswell. He said current account deficit has been brought down from 20 billiondollars to 13.5 billion dollars. He said steps have been proposed in thenext budget to reduce that deficit from 13.5 billion to 7 billion dollars.
The Advisor said 9.2 billion dollars were mobilized bilaterally fromfriendly countries, in addition to a three billion dollars’ oil facilityfrom Saudi Arabia on deferred payments. He said 1.5 billion dollars havebeen promised from Islamic Bank and an agreement of three billion dollarshas been signed with Qatar, while about six billion dollars will come fromIMF. The government has to repay debt taken by the previous regimes up to2.9 trillion rupees, while over 50 percent of federal taxes will have to begiven to provinces as a constitutional obligation.
He said, to meet all this, in the new budget, 50 billion rupees have beenless allocated for expenditure of the civilian government under austeritydrive of the Prime Minister. He said that the austerity has started fromthe top under which salaries of cabinet members have been decreased by 10percent, while a raise of just 10 percent has been announced for governmentemployees from grade one to 16. He said employees of grade 17 to 20 willget five percent increase in their salaries, while senior officers of grade21 and beyond will get no increment. He said expenditure of Prime MinisterHouse has been brought down drastically.
The Advisor said armed forces have volunteered to freeze their budget fornext fiscal year.
He said budget to help the downtrodden under social safety net has beendoubled from 100 billion to 191 rupees. He said cash transfers for needywomen will be ensured under this initiative and poor people will also gethealth cards to cater their medical needs. He said 216 billion rupees havebeen reserved to protect interests of electricity consumers, who use lessthan 300 units and they counts for 75 percent of the total consumers.
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He said 152 billion rupees have been allocated for the development of newlymerged tribal districts with Khyber Pakhtunkhwa, while 925 billion rupeeshave been ensured for development projects under Public Sector DevelopmentProgramme. He said special priority has been given to Balochistan, SouthPunjab, and other less developed areas in the PSDP.
Dr Abdul Hafeez Shaikh said industry will get gas and electricity onsubsidized rates and tariff on the import of raw material for theindustrial sector has been made zero rated. He said all kinds of taxes havebeen abolished on over 1650 tariff lines so that industry can flourish andease of doing business can be facilitated in the country. He saidincentives have been maintained for the industrial sector and no ax hasbeen imposed on exports and levies will only be on domestic sales.
The Advisor said the government has set a revenue target of 5,500 billionrupees for the next fiscal year as country cannot progress withoutenhancing tax net.
He also announced to extend the date of Asset Declaration Scheme tillWednesday. He said the extension has been made in view of heavy rush as alarge number of people are trying to take benefit of the scheme at the lastminute expiring today. He urged the people to take benefit of the scheme bydocumenting their benami assets till expiry of banking hours on Wednesday.He said that a Benami Commission has been formed, which will go after thebenami assets after Wednesday.
Dr Abdul Hafeez Shaikh mentioned that the National Assembly passed thebudget after a following a democratic process. He said about 215 MNA’sparticipated in the budget debate, while Senate and its finance committeealso discussed budgetary proposals in detail. He said opposition membersmoved their own cut motions, which were rejected by majority of the LowerHouse. He said supplementary grants of 220 billion for were also approved.He said business community, parliamentarians, and other stakeholders weretaken onboard regarding the budget under which several changes were made inthe finance bill.
