ISLAMABAD, Jan 24 (APP):Finance Minister, Asad Umar while addressing a press conference here Thursday enumerated three main problems Pakistan was facing at economic front that result in unsustainable economic growth over a long period of time.
The press conference followed the presentation of economic reforms package at the National Assembly. The minister was flanked by Adviser to PM for Commerce, Textile and Industry Production Razzak Dawood, Minister of State for Revenue, Muhammad Hammad Azhar and other officials of the ministry.
The minister identified the budget deficit as one of the major causes of economic problems, saying that the expenditures of the government were exceeding the revenue collection.
The minister said that similarly another major challenge was the increasing trade deficit as the country was exporting less compare to imports.
He said that third issue the country was facing that investment to GDP ratio was as low as 15-16 percent which needed to be enhanced upto 25-30 percent but added that only investments would not help overcome economic problems, there is need of national savings.
The minister was of the view that Pakistan was lagging behind in economic growth and there were just a few counties which are now behind Pakistan in growth, so there is need to work hard to put the country on development path.
He said that the new journey of economy growth and development has started with the announcement of reform package.
The minister said that the uncertainty in drawing rooms and TV talk shows was vast, but it does not reflect actual situation.
.:The finance minister said the current government after assuming the powers formed an economic advisory council and constituted sub-committees for the policy recommendation to bring about structural reforms for medium and long term sustainable economic development.
The economic reforms package was introduced in light of these recommendations and measures were proposed for the development of industrial sector, promotion of agriculture and attracting the foreign direct investment, he added.
The minister said effects of all the measures which were proposed for the sustainable long term development would be felt in medium term and that would put long lasting impact on national economy and social prosperity.
Replying to a question, he said financial agreement which was finalized during the prime minster’s visit to China was comprising on two parts including financial arrangements and trade enhancement.
The first phase of the agreement would be materialized within next few days and a high level delegation would visit China during next week to finalize the details about exports enhancement from the country.
The finance minister categorically said there was no new tax levied in Supplementary Finance Amendment Bill 2019, adding tax were imposed on the luxury vehicles above 1800cc which would not affect the common men in the country.
To an another question about entering into any financial arrangement with IMF, he said despite making measures to bridge the financing gap from friendly countries, the government was still engaged with the IMF and negotiating for a programme which would be in the larger interest of country.
Asad Umar said Pakistan was an independent and sovereign sate with a population of 220 million people and would not take any dictation from any one and would never bow down and continue pursuing its home grown policies for economic development.
He said national economy had entered from first phase to second one, adding international market and credit swap rating agencies had also improved the credit rating of Pakistan which would further improve during the days to come.
Speaking on this occasion, Minister of State for Revenue, Muhammad Hammad Azhar said revenue targets set for the current fiscal year would be achieved without imposing any additional tax.
He said non-filers were provided facility to purchase 1300cc vehicle, where as tax ratio for non-filers were increased and the anomaly in law was removed under which a person was authorised to purchase property worth Rs5 million and ban was imposed on the vehicle purchase.
He said government was taking measures to simplifying the tax return system besides reducing the indirect taxes, adding that tax return filing witnessed about 34 percent increase in first half of current financial year.
He said reduction in revenues during first half was attributed with increasing prices of petroleum in international markets and reducing the sales tax from 17 percent to 2 percent, adding income from the telecom sector was also stopped due to the orders of Supreme Court and ban on the purchase of property by the non-filers.
He expressed the hope that revenue collection would significantly improve during second half of the fiscal year as different measures were proposed in economic reforms package.