ISLAMABAD – Finance Minister Asad Umar on Monday envisaged that thecountry’s economic growth rate would be the highest in 15 years by 2023 onthe completion of five-year term of the the incumbent government.
Without giving any consolidated target figures, he said it would not be amanaged growth, but a sustainable one, as the government had initiatedvarious reforms to put the economy on right track and resolve its majorissues.
Launching a medium-term framework “A Roadmap for Stability, Growth andProductive Employment” here at the BISP headquarters, the minister said,“More importantly, this sustainable growth would not be achieved byincreasing the fiscal deficit, nor by creating balance of payments crisis,but would be on sustainable grounds after resolving all the fundamentalissues of the economy.”
He said the World Bank had reported that if Pakistan continued its journeyon the right path with consistency, it would have $2 trillion economy by2047 and would be ranked among countries having upper middle incomes.
Asad viewed that economic policies should be devised keeping in view futureprospects. If the policies were focused on winning next elections insteadof welfare of future generations, the same cycle of problems would berepeated.He expressed the hope that after five years, the next finance ministerwould not be explaining here how he had to face balance of payment crisisor to opt for International Monetary Fund (IMF) assistance, or the reasonsfor increasing inflation and depreciation of rupee.
The agreement the government was going to sign with the IMF would be thelast one, he hoped.The minister opined that the people had to face hard time due toimplementation of fundamental reforms and blamed the previous governmentfor all the crises.
He said the country had been facing basic economic issues for decades now,which included current account deficit, fiscal deficit, and low investmentand savings. Under the framework, measures had been introduced to resolvethe problems and lay a strong economic basis.
Asad Umar said owing to the government measures, the economy had enteredinto the stabilization stage after facing severe challenges adding thatthis phase would continue for about one and a half year, after which thecountry would go towards sustainable growth.He said that government was working on short, medium and long term measuresby restructuring fundamentals of the economy including tightening thecurrent account as well as fiscal deficit, enhancing revenue collection,promoting exports, increasing savings for investments and introducing theease of doing business.
He said that under the mid-term economic framework, reforms would beintroduced to streamline the tax system of the country by separating theadministrative and policy setups of Federal Board of Revenue.
The minister said that information system, digitization and integrated datasharing system was being evolved by making amendments in the constitutionin order to strengthen the collection mechanism.Besides, the government was taking steps for enhancing the enforcementcapacities, simplifying the returns filing system and bringing moretransparencies.
The minister said that government was planning to introduce assetdeclaration scheme, which broadly was aimed at documentation of economyadding that in this regard the system of collecting information from abroadwas now in place.
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He said the draft of the mid-term policy framework would be shared with thestanding committees of the National Assembly and the Senate and theirsuggestions would be sought to bring further reforms in the framework.Asad Umar said that rules and regulations for the Benami law was finalizedand the notices were being served to all such persons having Benamiproperty and assets.
With regard to exchange rate and strengthening the value of rupee againstdollar, the minster said that the country had to faced immense losses dueto the wrong decisions of the previous government to keep the real exchangerate high and keeping the rupee overvalued.The minister said that the exchange rate was just an instrument for aneconomy, but it was not used to measure the power of the economy.“We have kept our currency overvalued for several years, which onlysupported the importers and their consumers of these luxury items,” he said.
He said government was taking measures to stabilize the exchange rate byrestructuring its fundamentals and promoting the exports of the countryadding that government had introduced sales tax refunds certificates underwhich the exporters had claimed refunds amounting to Rs45 billion.
He said that this move of the government would help to overcome theliquidity issues of the exporters besides making the local exports morecompetitive and helping them to capture more markets for their products.
Asad Umar said under medium term economic framework, the government wasalso working on improving ease of doing business and had set a target tobring the country among the top 70 countries in term of ease of doingbusiness as current the country stood at 100th position.
The minister said the government was also focusing on promoting regionaltrade by improving connectivity through Afghanistan, Tajikistan, Iran,Turkey, India and China.The minister said that negotiation for the development of road link wasalso discussed with World Bank to further improve the road network withinthe region for harnessing the true potential of trade existing in differentsectors of the regional economies.
He said during his visit to Washington DC, he would meet with the financeministers of Tajikistan and Afghanistan to discuss prospects of bilateraltrade and investment with these countries.
“Traditionally Iran has been kept isolated, but we are mulling over toreach the European market by enhancing road and rail connectivity with Iranand Turkey,” he added.
He said Pakistan was ready to discuss issues including Kashmir with Indiato normalize relations with it and promote regional trade.
