Daily Times

The Upper House was on Friday informed that the current government borrowed more than $10 billion from international financial institutions under its reform agenda, including $4.11 billion from the World Bank and $3.66 billion from the Asian Development Bank (ADB).

During the Senate session, the finance ministry presented details of losses incurred by the national economy due to coronavirus pandemic as well as the loans acquired from international financial institutions for the government’s reform agenda.

Apart from $4.11 billion from the World Bank and $3.66 billion from the Asian Development Bank (ADB), other loans included $1.68 billion from the Islamic Development Bank (IDB) and $800 million from the Asian Infrastructure Investment Development Bank. The ministry said that markup on the International Monetary Fund (IMF) loans is 4.05%, while its repayment will begin in 2024 and continue until 2032.

During the session, chaired by Senate Chairman Sadiq Sanjrani, the government acknowledged that consensus eluded the ninth National Finance Commission (NFC) award therefore, at present, there was no proposal in hand for the announcement of the award.

The House was informed that the present government has signed 21 agreements with the World Bank and 22 with the ADB, while 58 agreements had been signed with international financial institutions to reform public institutions, the lawmakers heard. The session was informed that 19 state utilities would be privatised, while the process for 14 enterprises was currently under way. These included Baloki Power Plant, Haveli Bahadur Shah Power Plant, SME Bank, First Women’s Bank, Service International Hotel, Roosevelt Hotel, State Life Insurance Corporation Pakistan Steel Mills, Heavy Electrical Complex, Jinnah Convention Centre and Oil and Gas companies.

The finance ministry said that the gross domestic product (DGP) growth rate fell by 2% because of the coronavirus pandemic, which emerged in the country in February this year. Because of the disease, tax revenues also fell by Rs809 billion but the deficits of state-owned enterprises came down by 20%.

According to the finance ministry, public sector enterprises incurred losses to the tune of Rs1.014 trillion in the last two years — Rs563.28 billion in financial year 2017-18 and Rs450.84 in 2018-19, the ministry said, adding that the overall losses of the state-owned enterprises fell by 20% last year.

According to the ministry, the GDP growth rate fell from 2.4% to -0.4% because of the coronavirus pandemic. Because of the pandemic, it added, the Federal Board of Revenue (FBR) lost Rs809 billion in tax revenue collection, budget deficit increased by 1% while exports target was also missed.

Separately, the ministry in its written reply informed the house that there was no proposal for the announcement of the ninth NFC Award. It said that five sessions of the ninth NFC had been held but because of no agreement, the 10th NFC had been constituted.

Responding to a calling attention notice regarding drugs prices, Parliamentary Affairs State Minister Ali Mohammad Khan told the house that the previous governments had given control of drug prices to pharma companies. He said the governments of the Pakistan People’s Party (PPP) and Pakistan Muslim League-Nawaz (PML-N) had linked drug prices to the Consumer Price Index (CPI). “Our government has taken the step that pharma companies will have to get permission from the health ministry before raising the prices.”

He said that the pharmaceutical companies have agreed not to raise the drug prices during the coronavirus pandemic. About the recent increase in the prices, he said that those 94 drugs, which became more expensive, accounted for 1.5% of total use.