Finance Minister Asad Umar Monday said Pakistan’s economy has come out of the ‘crisis phase’, and is now heading towards the sustained stabilisation.
“Owing to the government measures, the economy has entered the stabilisation stage after facing severe challenges … this phase will continue for about one and a half year, after which the country will go towards a sustainable growth,” the minister said at the launching ceremony of medium-term framework ‘A Roadmap for Stability, Growth and Productive Employment’, here at the BISP headquarters. He envisaged that the country’s economic growth rate will be the highest in 15 years by 2023 on the completion of five-year term of the incumbent government. Without giving any consolidated target figures, he said it will not be a managed growth but a sustainable one, as the government has initiated various reforms to put the economy on right track and resolve its major issues.
“More importantly, this sustainable growth will not be achieved by increasing the fiscal deficit, nor by creating balance of payments crisis, but will be on sustainable grounds after resolving all the fundamental issues of the economy,” the minister said. “The World Bank has reported that if Pakistan continues its journey on the right path with consistency, it will have $2 trillion economy by 2047 and will be ranked among countries having upper middle incomes,” he added.
Asad viewed that economic policies should be devised keeping in view the future prospects. “If the policies are focused on winning next elections instead of welfare of future generations, the same cycle of problems will be repeated,” he said, and expressed the hope that after five years, the next finance minister will not be explaining here how he had to face balance of payment crisis or to opt for International Monetary Fund (IMF) assistance, or the reasons for increasing inflation and the depreciation of rupee. “The agreement the government is going to sign with the IMF will be the last one,” he hoped.
He said the government is working on short-, medium- and long-term measures by restructuring fundamentals of the economy, including tightening the current account as well as fiscal deficit, enhancing revenue collection, promoting exports, increasing savings for investments and introducing the ease of doing business. He said under the mid-term economic framework, reforms will be introduced to streamline the tax system of the country by separating the administrative and policy setups of the Federal Board of Revenue. He said information system, digitization and integrated data sharing system is being evolved by making amendments in the constitution in order to strengthen the collection mechanism.
Minister says the country will move on the path of sustainable growth, following an 18-month stabilisation phase
The minister said the government is planning to introduce asset declaration scheme, which broadly aims at documentation of economy, adding that in this regard the system of collecting information from abroad is now in place. He said the upcoming tax amnesty scheme will be the last chance for tax evaders to declare their properties and assets and avoid any legal action which will be initiated against defaulters after the scheme is closed. He said the scheme will be successful only when people realize that the day this opportunity ends, they will not find any place to hide their assets, adding the details of the schemed will be revealed within a couple of days.
Asad Umar said that rules and regulations for the benami law have been finalized and the notices are being served to all such persons having benami property and assets.
With regard to exchange rate and strengthening the value of rupee against dollar, the minister said the country had to faced immense losses due to the wrong decisions of the previous government to keep the real exchange rate high and keeping the rupee overvalued. The minister said the exchange rate is just an instrument for an economy, but it is not used to measure the power of the economy. “We have kept our currency overvalued for several years, which only supported the importers and their consumers of these luxury items,” he said.