November 6, 2021 (MLN):  A comprehensive economic plan along with political will is crucial to regain the country’s lost economic glory, Shaukat Tarin, Advisor to Prime Minister on Finance and Revenue said yesterday while addressing the 18th Annual Excellence Award ceremony of Chartered Financial Analysts (CFA) Society as a keynote speaker.

Throwback to the memory lane, he highlighted that Pakistan was on a similar trajectory as the Asian Tigers during the 1960s as it jumped to an average annual rate of 6 percent from 3 percent in the 1950s. However, after the fall of East Pakistan and needless participation in the Afghan war, Pakistan lost its way.

In the absence of the political will of the successive governments and improper planning with no execution of policies, the economy could not realize its potential, he added.

The incumbent government was inherited with the large current account deficit and devalued rupee. The government entered into a tough IMF program with many conditions which initially led to slowing down the economy.

However, under the visionary leadership of Prime Minister Imran Khan, Pakistan has made its way towards prosperity and currently, all the macroeconomic indicators are posing decent growth.

The present government also encountered the toughest time due to the COVID-19 outbreak but the apt policy measures came to the rescue. Not to forget, the idea to impose a smart lockdown by Prime Minister Imran Khan has been recognized globally saved the country from the further economic crisis.

“Concurrently, Prime Minister Imran Khan has invested in agriculture, housing, industrial and exports sectors. All those areas promoted employment in the country and resulted in a 3.94% growth last year. The policy measures would certainly lead the economy to witness a 5%-6% growth rate in the future,” he noted.

He also said that the government is deploying every resource to uplift the industrial sector of the country. One of the aims includes boosting the volume of exports and to execute this, numerous incentives have been given to the export-led sectors.

Currently, the IT and Telecom sectors are the prime focus for the government and the results are started to pop out. In the next five years, IT exports could reach $15 billion.

Besides, the government has also been giving subsidies to the energy sector for its uplifting since the sector remained under crisis for a long time.

Talking about the tax to GDP ratio, he was of the view that a 9% tax to GDP ratio is not enough for a state like Pakistan to attain the required growth. Everyone has to play their due role to improvise this figure.

“Despite being an agricultural country, Pakistan is witnessing the issues like food crisis. Last year the import bill of food-related items was $10billion,” he noted.

In order to improvise the performance of the agriculture sector, the government has earmarked the subsidy of Rs770bn.

The agriculture sector is started showing decent progress and the Cotton production likely to be around 9.5 million bales in months to come.

While answering a question regarding IMF talks with government and its impact on the overall economic growth, he clarifies that IMF and the government are on the same page as both of them want to accelerate economic growth. He mentioned that the government has met almost all the conditions of IMF.

He also added that the “Economy will not slow down owing to the IMF program.”

Pertaining to the burning topic, the advisor said that the petrol levy has been reduced by Rs 9 as the petrol is not being produced in the country but is being imported. However, a subsidy of 450 billion has been given on petrol so far, adding that the price of petrol would have been Rs 180 billion per liter today if the government had not given subsidy.

In order to cope up with the ongoing wave of inflation, the government is extending all the possible help to the poor strata of the country.

While addressing the financial sectors’ personnel he indicated that the financial sector is only 33% of GDP while the contribution of lending is only 15% of GDP. This thriving sector has more potential to realize.

“We have to make our financial sector more responsive to the needs of the economy,” he said.

To note, every year CFA Society Pakistan recognizes the outstanding performance of financial institutions, corporates, and professionals in Finance and Investment Management at the Annual Excellence Awards Ceremony.

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