ISLAMABAD: Minister for Planning, Development and Reforms Ahsan Iqbal on Thursday, while unveiling the Economic Survey 2017-18, said Pakistan had achieved the growth rate of 5.79%, highest in the past 13 years.
Addressing a press conference along with Prime Minister’s Adviser on Finance Miftah Ismail, the minister said growth momentum remained above 5% for the last two years in a row and reached 5.79% in FY2018 on account of a strong performance by agriculture, industry and services sectors which grew by 3.81%, 5.8%, and 6.43% respectively. “This is the highest growth rate in 13 years. We could have easily achieved a 6.1% had the country not faced political instability in the past year,” he added.
The minister said that the growth rate figure was endorsed by the World Bank and other international organisations. “Economics I often say is not a homeopathic medicine that does not have side effects,” said Iqbal. “We had the possibility to resolve the power crisis in eight years and that could have given us a more stable macroeconomic plan but we had no choice because we needed growth and opportunities for the youth.”
Responding to a question about the current government presenting its sixth budget when it was due to retire in June, Miftah Ismail said that it would be a dereliction of duty on the part of the parliament to not present the budget. “The budget, in which 95 percent of the expenditures will remain the same for the incoming government, is a set of measures and estimates. Its presentation is meant to help businesses and industries decide their future course,” he said.
“We know well that the assemblies will dissolve on May 31. The incoming government can modify the budget according to its own strategies but the federal government has to define the country’s fiscal policy for one year,” he said. The budget of the provinces has little impact on the country’s fiscal policy as it is allocated from the revenues of the federal government, he added.
The adviser said the development budget for ongoing projects was set at 80%, while Rs 100bn had been reserved for the incoming government. “The amount reserved for the incoming government’s development budget is a leverage that we had not even afforded to ourselves,” he said.
He said that all the economic indicators have shown positive growth while the government succeeded in containing inflation rate at 3.8 % while current year will end with around 4.5 %, he said, adding that the deficit which was 8.2 % in 2013 will remain at 5.5 % by the end of the current fiscal year.
He said revenues of Federal Board of Revenue (FBR) will be around Rs 3,935 billion by the end of year, while the revenues in 2013 were only Rs 1,980 billion. However, the net debt to GDP ratio, he said, had increased from 60.2 % to 61.4 %.
He said the external debt to GDP ratio remained 20.5 % which was low as compared to the ratio of 21.14 % in 2013. “Our current expenditures have declined while the development expenditures have increased considerably,” he said, adding, “We added 12000 MW to national grid in five years, we completed the long awaited projects such as Neelum-Jhelum power project and Lowari Tunnel project, which were lingering for decades and we also concluded Tarbela-IV project.”
The adviser said these development expenditures were now giving dividends as the country witnessed the highest growth rate of 5.79 % in 13 years. He said the weak point remained the declining exports during the first four years. However, he said that with the start of the current calendar year, the exports have captured the upward trend as during March 24 % growth of exports was recorded compared to same month of the year 2017.
Published in Daily Times, April 27th 2018.
