Economic indicators improve - govt working on giving benefits to masses: Hafeez

ISLAMABAD: While hinting to pass on benefits of reduced oil prices in the international market to domestic consumers next month, Adviser to PM on Finance Dr Abdul Hafeez Shaikh said the government was preparing economic package for doling out relief through quick decision-making process.

The public focused decision, he said, would provide relief to people. However, it is not yet known that how the fiscal space will be created under tight nose scrutiny of the IMF to provide relief measures amid tight fiscal position of the country. For instance what the government will do in case of meeting revenue shortfall.

After attending meeting under chairmanship of Prime Minister Imran Khan, Dr Abdul Hafeez Shaikh in his video clip stated that the roadmap devised for the revival of economy would be discussed with the premier on weekly basis so that the implementation on decision could be ensured without any delay. He said subsidy allocated for business on provision of electricity and gas would be provided continuously to them. Secondly, he said that the provision of loan for private sector would be ensured and thirdly, the government would sit with business sector in order to avoid burdening them with increased taxation.

Keeping in view highest discount rate that stood at 13.25 percent, any expectation from private sector to get loans will be a far cry. So the government will have to convince the State Bank governor to bring down policy rate otherwise crowding out will continue to persist for private sector. The whole economic team led by Dr Shaikh held hours long meeting with Imran Khan for discussing salient features of proposed economic revival plan in order to kick-start sluggish economic activities in the country. The economic team comprised of Minister for Planning Khusro Bakhtyar, Minister for Economic Affairs Hammad Azhar, Adviser to PM on Commerce Abdul Razak Dawood and other members.

The adviser on finance said that there were three to four basic objectives of Saturday’s meeting and first of all was to assess the performance of different economic ministries including Planning, Agriculture, FBR, Industries and others and how the allocation made in the budget could provide benefits to common man. For instance, he said the government allocated Rs950 billion for development budget as completion of development projects would have positive impact on lives of people and help the government create job opportunities. He said that premier directed to monitor mega projects on continuous basis so that these could be completed in timely manner. The government, he said, allocated Rs192 billion for cash transfer to poor segments of the society and all such programmes would be accelerated to provide sigh of relief to vulnerable segments. Thirdly, he said the government allocated Rs262 billion for subsidy in order to protect poor segments from hike of electricity. The government will also help the business community to bring down the cost of doing business, he added.

He mentioned some positive developments and said the stock market improved by 9 percent and current account deficit reduced significantly as it stood at $2.1 billion in July 2018 but now it slashed down below $600 million. All these positive indicators are motivating to transfer benefits to general public, he added.

He said the government was preparing economic roadmap in the aftermath of these positive developments. He said if the government wanted to enhance productivity of agriculture sector, construct mega dams or wants to bring investment into economic zones, all such decisions would be taken under this roadmap.

Tt was told during the meeting that the budget deficit was estimated to stand at 8.9 percent of GDP with primary balance of 3.6 percent of GDP for the fiscal year 2018-19 that ended on June 30, 2019.