Agriculture credit disbursement increases by 10.7%

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ISLAMABAD: To ensure food security and increase agriculture production, the National Assembly on Friday was informed that the credit disbursement to agriculture sector has been increased by 10.7 percent over the last year.oThe agriculture credit has increased to Rs255.7 billion during July-March FY14 against Rs231 billion during the same period of fiscal year 2013, posted a growth of 10.7 percent. The increase in credit facility to farmers will definitely help in higher agriculture production, which ultimately ensures food security in the country. In written the national assembly was informed that apart from agriculture, the credit to private sector increased to Rs.322.9 billion against the level of Rs118.9 billion in the comparable period last year, thus posted a growth of 9.6 percent during July- 18th April, FY14 against 3.5 percent in the same period last year.oThe parliamentarians were informed that the government has taken a combination of fiscal, monetary and financial policies to boost up growth and keep the economy on right track. Effective fiscal policy tools are being utilized in order to contain the fiscal deficit. In this regard the parliamentarians were informed that 30 percent cut on current expenditure excluding debt servicing, defense payment and allowances and grants.oReducing untargeted subsidies through phasing out of electricity subsidies, revenue collection and expenditures are being monitored on monthly basis and restructuring of Public Sector Enterprises (PSEs) to overcome the huge losses and moving towards the privatization process. The ministry of finance further informed the parliamentarians that due to above measures, the fiscal deficit is contained at 3 percent of GDP during July-February, FY14 against 4.2 percent of GDP in the same period of FY13.oThe Federal Board of Revenue (FBR) is working on comprehensive strategy to increase the tax to GDP ratio from lowest level of 8.5 percent to 15 percent in next few years. This will help the government to contain its borrowing for budgetary support from banking system. The government borrowing for budgetary support has also reduced significantly during July-18th April, FY14, as it stood at Rs326 billion against Rs948.4 billion in the same period of FY13.oSuccessful launching of Euro bonds worth $2 billion, Coalition Support Fund (CSF) inflows and auction of 3G/4G license are further strengthening government’s effort for resource mobilization and to uplift the economy. On monetary side, interest rate has been increased by 100 bps from 9 to 10 percent during current fiscal year in order to control inflation. Strengthened the balance of payment position through effective policies of attracting remittances, entered into IMF program, confidence of multilateral organizations for boosting foreign inflows, strengthening exchange rate and improving the reserve position.oRevival of the investor’s confidence remained one of the priority areas by taking number of measures to bring peace and stability which resulted in a remarkable performance of capital market. Effective measures are being taken to contain inflation and to maintain the stability in prices and supply situation. The government has launched measures to address the energy related issues and developed an energy policy to provide a roadmap to overcome the present energy crisis and fully meet the future needs of power in the country. In order to ensure availability of food items and maintain smooth prices, food security policy is being finalized, the finance ministry told in its reply to the national assembly. 

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