KARACHI: Federal Minister for Finance and Economic Affairs, Senator Muhammad Ishaq Dar on Friday said that for over 8 months the economy has registered an all-round performance indicating that there is a solid turn-around in the country.
Pakistan Muslim League-Nawaz (PML-N) government on the completion of 8 months of its tenure is in a position to share the results of major economic indicators of economic performance over this period, he said.
The Federal Finance Minister was speaking at the exports trophy awards ceremony of Karachi Chamber of Commerce and Industry ( KCCI) here, which was graced by Prime Minister Muhammad Nawaz Sharif as the chief guest.
He said that almost every single economic indicator— from gross domestic product (GDP) to inflation, agriculture to industry, from imports to exports, from remittances to foreign inflows, from exchange rate stability to interest rate, fiscal deficit to revenues and from reserves to public debt- shows a new positive beginning for the country’s economy.
“Allah has rewarded our pure and good intentions, the hard work that our government has rendered under the exemplary leadership of Prime Minister Muhammad Nawaz Sharif,” he remarked.
He said the confidence of the people of Pakistan has been revived and it is bringing about a remarkable turn-around to the economy.
There are numerous challenges and milestones that we have to achieve and hence we are not complacent by this initial success, rather our resolve to work harder has been strengthened and we will work with more vigor and energy to achieve our objectives, he said.
Elaborating his government’s steps taken over last eight months, the Federal Finance Minister said that PML-N government has chalked out a comprehensive plan for building reserves by $10.095 billion during 2014 as to reach $16.021 billion by Dec 31, 2014.
The prime minister has announced far-reaching tax incentives as well as a comprehensive youth programme.
Under the tax incentives, non-filers of tax returns as well as dormant NTN holders can avail concessions by April 30, 2014 while for investment scheme, commercial operation date has been fixed on or before June 2016 to avail incentives under the prime minister’s package for industrial growth.
The government has also published, in terms of the provisions of Section 216(6) of the Income Tax Ordinance, 2001, a tax directory on Feb. 15, 2014 containing names, NTN and tax paid by all the parliamentarians.
In the second phase, a tax directory of all taxpayers in the country will be published, he said.
Federal Finance Minister Senator Muhammad Ishaq Dar said that efforts were underway to disinvest, in a transparent manner, shares of certain banks and PSEs in the stock market.
The government’s preferred option is strategic partner with 26 percent shares and handing over of management.
As post-budget relief, the government has announced 26 measures to boost the business sector.
It has also announced withdrawal of 2% extra tax for further processing of parts and in use of manufacturing vehicles.
On March 13, we announced that all sales tax refund cases up to Rs one million would be processed and sanctioned as per law by April 15, 2014. There will be 26,000 beneficiaries of this measure out of a total of 36,000 cases, he said.
The minister said that incorporation of new companies has increased by 14.95 percent in the first eight months of 2013-14 as compared with same period last year. KSE index has risen from 19,916 to 27,309 index on May 11, 2013; showing an increase of 37.1 percent. Federal Board of Revenue’s (FBR) revenue collection has risen to Rs 1,348 billion during July to February 2013-14 as compared to Rs 1,145 billion; an increase of 17.7 percent.
In the first eight months of 2013-14, budget deficit has decreased from 4.1 % at Rs 1,053 billion to 3.1 % at Rs 1,015 billion, he said.
Remittances during the same period have increased to $10.24 billion compared to $ 9.23 last year; showing an increase of 11.2 percent. The exports have increased by 6.2 % during July-February of fiscal year 2013-14 as compared with same period of
2012-13, he said.
The minister said that Pakistani Rupee has improved its value against dollar; pushing down dollar below Rs 100 in the interbank and open market (kerb). Foreign exchange reserves have improved to $9.52 billion as on March 11, 2014.
Overall, the quarterly GDP growth in 1st quarter 2013-14 has been 5.0%, including growth in LSM of 6.8% in that quarter.
Significantly, LSM grew by 13.2% in the month of December 2013; a rate unprecedented in the last seven years.
The finance minister said that government’s policies/decisions have got international recognition. The Overseas Investors Chamber of Commerce and Industry (OICCI) which conducts regular surveys on business confidence has raised its index for Pakistan from -34 to +2.
According to Perception and Investment Survey 2013 (conducted during September-November 2013) released by the (OICCI) on January 28, 2014 foreign investors intend to inject around $3 billion investment in the Pakistani economy in the next five years due to the fact that foreign investors have done well in terms of their bottom lines.
Federal Finance Minister Senator Muhammad Ishaq Dar said Pakistan has been ranked second in the world in terms of business growth in a survey conducted by the Japan External Trade Organization (JETRO).
Former Goldman Sachs economist Jim O’Neill, famous for coining the term BRIC, coined another term MINT identifying top investment destinations in the coming years.
He has also forecasted that Pakistan would become world’s 18th largest economy by 2050 (from its present 44th position).
Highlighting the PML-N’s medium-term economic roadmap, the minister said: “Our medium term 3-year aim is to raise the GDP growth gradually to around 6% to 7%, investment / GDP to 20%, tax / GDP to 13 % and foreign exchange reserves to around $ 20 billion. Also, we aim to bring fiscal deficit down to 4% of GDP and public debt to below 60% of GDP as per statutory requirement.”
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