ISLAMABAD: Enumerating the economic gains of the PML-N government, Federal Finance Minister Senator Muhammad Ishaq Dar on Saturday said conspiracies were being hatched to destabilise the government at a time when the economy was about to take off.
Speaking at the Jang Pre-Budget Conference 2016-17 here, he said vested interests were dragging the prime minister and his wife into the Panama Leaks controversy despite the fact that no finger had been pointed at them.
“The country’s history is witness to this kind of syndrome. The leg-pulling must stop now, as the prime minister has clearly announced that his family would be ready to face accountability for each and every penny earned.
“The chapter of the Panama Leaks should be closed now enabling the country to move ahead towards development and prosperity at full speed,” he said while jealously defending the government’s polices and cushioning it against the opposition’s criticism.
“The politics of agitation and negativism has already inflicted colossal losses on the country’s economy.
“During the 126-day sit-in front of the Parliament House, the country suffered a lot. It also lost a transaction of Rs100 billion during those days which was later on retrieved,” said Dar.
“We all know that the prime minister has written a letter to the Chief Justice of Pakistan (CJP) for the constitution of an inquiry commission as per the demand of the opposition and now the Supreme Court will take the necessary action.”
In an overt reference to the opposition, the minister said: “Let’s not allow conspiracies to destabilise the government; rather, all stakeholders, including the political parties, without wasting time should focus on the national economic agenda. “To this effect, all stakeholders must come forward to develop a consensus on the charter of the economy which should not be affected by any political adventure at any cost so that Pakistan could become an important global economic player.
“Continuity of prudent economic policies will be the key to the prosperity and development of the country,” said the minister.
He said the prime minister and his government were very clear about wiping out corruption and bad governance which had virtually crippled the country’s economy.
He said the government had tasked the law committee with suggesting changes in the law in the context of the Panama Papers.
He said globally Pakistan was not recognised as a corruption-free country with good governance.
Dar said the prime minister ensured transparency in every project allowing no scandal. In the past, he said, the prime minister removed one federal and some provincial ministers for corruption.
The finance minister said the budget 2016-17 will be growth-oriented, as the government had successfully consolidated macro-economic indicators and 22 global financial institutions had also acknowledged that Pakistan’s economy had turned around and was now poised to take off.
“We are committed to our goal to develop the country and put it on the road to prosperity, but this cherished objective could only be achieved if the system is not derailed.”
“We took over the government when the State Bank’s reserves stood at just $2.8 billion that were enough for the import of just nine days and the country was on the verge of default.
We worked day and night and turned the economy around in just two years by adopting a tight fiscal policy.
At that time, international experts were of opinion that our ruined economy will take at least four years to turn around if prudent economic policies were practiced.
Continuing, Dar said keeping in view the bad economic performance of the last government, the international experts had predicted that Pakistan will definitely default in 2014.
“The circular debt was at Rs503 billion and the country was facing over 20 hours of load shedding.
“We immediately paid the circular debt and in return the electric power producers injected 1,700 MWs in the national grid giving huge relief to the masses from loadshedding,” said the finance minister.
He said four independent audits of the payment of amount involved in circular debt were carried out but no bad practice came out meaning that Rs503 billion was paid in a transparent manner.
Now with the prudent policies, the state bank’s reserves stand at $15.8 billion which are equal to four months’ imports, he added.
“Yes, we managed $15 billion loans, but factually we paid back $10 billion and the net increase stands at $5.3 billion.”
In addition to the power sector, he said, the State Bank was to pay billions of rupees to commercial banks under the head of the Remittances Initiative Scheme.
“The government ensured payment to commercial banks. And the refunds of the businessmen that FBR was to pay stood at Rs210 billion.
“Remittances have increased by 15-16 percent in three years from $13.9 billion to $18.50 billion. The government now expects that they will further cross the staggering figure of $19 billion during this fiscal.”
Dar said the government had carried out a detailed postmortem of exports and came to know that exports had increased in terms of volume but gone down in terms of value.
“We have expedited the payment mechanism of the amount stuck with the FBR in shape of refunds and will pay the entire refunds in July this year.”
Terming the fiscal deficit the mother of all ills, the minister said the government had brought down the fiscal deficit from 8.8 percent to 4.3 percent that was close to the world economies’ standard of 4 percent.
“We introduced fiscal discipline due to which our sinking economy turned around in just two years.
“To this effect, the BBC and 22 international financial institutions (IFIs) have acknowledged the fact that Pakistan’s economy has stabilized now and is all set to take off.”
Mentioning the CPEC project, Dar said out of $46 billion, an amount of $35 billion will be invested through the private sector in various projects and there will be no loan for the government to pay.
“The private sector will pay back the loan.”
He said by 2013 tax growth stood at 3.3 percent that had now increased to 56 percent from an increase in revenue from Rs1400 billion to Rs3100 billion.
He said tax distortions were being erased and to this effect exemption to the elite was being phased out.
“In the first fiscal year of the government, we have erased the one-third SROs of Rs103 billion exemptions, in the second financial year Rs123 billion exemptions were withdrawn and in the next budgetary year, the government will do away with the SROs with exemptions of Rs100 billion.”
Talking about the energy crisis, Dar said Pakistan will be having an additional 10,000 MW power by March 2018 and 12,000 MW by December 2018.
He said the government was working to increase power generation to 25,000 MW keeping in view future needs by keeping the country moving with 7-8 percent GDP growth.
The minister said Pakistan was at war with extremism and to bear its expenses, the government had imposed super tax on the profit-making sector, including the banking sector.
“This tax will continue next year too, as we have to reconstruct the war-hit areas in North Waziristan and repatriate the Internally Displaced Persons (IDPs).
“We require $1.9 billion (Rs190 billion) for this purpose. We need Rs230 billion in total to cope with this issue. The government wants to accomplish this task from its own resources,” he added.
Without naming any TV channel, the minister came down hard on some anchors saying that some of them might be raising a hue and cry because of closure of “lifafa”, as it was the PML-N government that abolished discretionary funds of Rs42 for PM and other 34 ministries and departments except the ISI and IB.
“I hereby declare that there will be zero allocation for discretionary funds for the PM in the coming budget,” he added.
Dar said there was need to strengthen the defamation laws in order to keep a check on the airing of false information by the TV channels.
“It is our desire that the media should come up with its code of ethics; the government can look into the need of introducing laws to this effect if they desire so.”
He said Zarb-e-Azb cost the state kitty Rs230 billion requiring contribution from the affluent class.
“For the social safety net under the BISP, he said allocation had been increased from Rs40 billion to Rs107 billion by increasing coverage from 3 million to over 5 million in the last three years. The number of beneficiaries has increased to 28 million.”—Originally published in The News