Federal Minister for Finance and Revenue Senator Ishaq Dar has declared that the economic erosion has been halted and the next year’s federal budget will spur development linked to economic growth, reported 24NewsHD TV channel.
Addressing a news conference in Islamabad on Saturday a day after the federal budget for the fiscal year 2023-24 with a total outlay of Rs14.46 trillion, Ishaq Dar maintained that the government intends to address all concerns of the stakeholders regarding the budget.
Ishaq Dar while briefing media persons on the budget along with Minister of State for Finance and Revenue Dr Aisha Ghous Pasha said “With effect from Monday two committees will be set up in the Federal Board of Revenue to address budget anomalies.”
He said there is a customary practice of forming two committees within the FBR — one for business-related issues and the other for technical matters.
He said that the FBR chairman will obtain his approval on the matter, and the committees will be formed by Monday. “The purpose of these committees is to address any missed aspects and provide an opportunity for individuals with complaints or genuine recommendations to be heard and considered by the government.”
The minister said the budget envisages a federal Public Sector Development Programme (PSDP) worth Rs1,150 billion, which is the highest ever in terms of its size. “I believe that if the PSDP amount is invested transparently, the modest target of 3.5% economic growth is easily achievable,” he said.
He said that the economic growth target of 3.5% is “not unrealistic” and “doable”. “Multiple multilateral institutions including Asian Development Bank (ADB) have conservatively projected a 2% growth, however, the International Monetary Fund (IMF) itself has said that the country could achieve a 3.5% growth, Bloomberg and Fitch expects 4% growth,” he added.
Ishaq Dar described the budget as being different from traditional budgets, stressing its focus on progress linked to economic growth.
He expressed the government’s aim to reverse all economic losses, adding “our first objective is to go back to achieve 2017 economic marks.”
Talking about macroeconomic indicators, Ishaq Dar said inflation is projecting at 21 percent, FBR revenue collection to GDP 8.7 percent, overall deficit 6.54 percent, primary balance 0.4 percent and public debt to GDP 66.5 percent. He said the previous PML-N government had left this figure at 63 percent, which rose to 74 percent during the last PTI-led regime. He said debt to GDP means a lot and a core indicator and we are pitching this figure at 66.5 percent, while GDP is expected at 105.8 trillion rupees.
He hoped that the poverty and unemployment would be reduced. He said no new amnesty scheme has been announced in the budget. He was of the view that if the public and private sectors go hand in hand, then the wheel of the economy would run.
The finance minister said that Pakistan could become a food-secure country. We have added the agro-based industries to the SMEs and soon the government will introduce the cheap loans scheme and provide tax relaxation on seeds. He said that Rs2,200 billion loans would be given to the agriculture sector.
Dar said the government allocated a historic size of Rs1,150 billion in development funds under the PSDP, which was almost double the funds of Rs567 billion utilized in 2022-23.
He said that special facilities have been announced for the IT sector, adding that soon a special IT zone will be established.
He said that the government could not give an annual Rs1,000 billion subsidy on the power sector and ‘we must not do so. We are looking at it, we are trying to bring some improvement. However, whatever party forms government after elections, it can look into it’.
He announced that the government would give subsidies on flour, ghee, rice and lintels.
He said the budget of BISP has massively been enhanced to 450 billion rupees to support segments of society.
Ishaq Dar said the Sharia Compliant products under National Savings will be launched from next month.
Ishaq Dar said no new taxation measures have been taken in the new budget.
He ruled out a 9% tax on packaged milk. He denied news of imposing any tax on milk, saying there is no tax on loose milk at all.
Ishaq Dar said no new taxation measures have been taken in the new budget. He further denied increasing the petroleum levy from Rs50 per litre.
He said the sales tax on import of edible oil has not been abolished. He said that the recent reduction in the prices of edible oil is the result of international trends.
He vowed that the government will remove the concerns of the trader community before finalizing the budget.
Dar told the media that the government is working on a scheme to outsource airports. He revealed that 12 companies have shown interest. He hoped that by July, the government would seek bids to outsource at least one airport.
He rued that the government’s petrol scheme was for small 800cc vehicles ‘but since we are in the IMF program, the lender could not digest it. Hence the program is facing delay’.
He further warned that government would take action against those organizations which would not be paying minimum wages to their workers. He asked the civil society to play their role in this regard.
The minister once again categorically stated that Pakistan will not default, stressing that the country has ensured payment of external liabilities in the past and will do so in future as well. He was confident that the European countries will extend the GSP-Plus status of Pakistan. To a question, he made it clear that Pakistan has no plan to go for rescheduling of Paris Club or multilateral debt. He once again said that we will make all the payments on time.