Dar reiterates govt commitment to economic reforms

ISLAMABAD: Finance minister Ishaq Dar on Tuesday reiterated the government’s resolve to continue on the path of economic reforms, articulated at the beginning of 2013-14, and which had been pursued during the last three years.

“The government is focused on further improving the key macroeconomic indicators, including the investment-to-GDP and tax-to-GDP ratios,” a statement quoted Dar as saying.

He was chairing a meeting to review the five-year (2017/18 to 2021/22) macroeconomic framework.

The framework forms the basis of policy decisions in the areas of annual and multi-annual budgets, management of reserves, investments and economic growth. 

The finance secretary presented macro-fiscal forecasts, highlighting key areas where policy interventions would be required to take the country on a higher-growth trajectory. 

It was observed in the meeting that strong economic reforms already implemented by the government would increase economic opportunities and lead to higher economic growth.

Dar directed the officials to align medium-term fiscal policy with the targets provided in the amended Fiscal Responsibility and Debt Limitations (FRDL) Act. 

The FRDL Act requires the federal government to bring down its deficit in three years, starting with 2017-18 to four percent of GDP, and thereafter maintain it at a maximum of 3.5 percent.

“The law requires that the debt-to-GDP ratio will be brought down from the current statutory limit of 60 percent to be achieved by next year further down to 50 percent in 15 years,” the minister said.

“These commitments should be built and adhered to in future projections of macroeconomic framework.”  

Dar said a comprehensive and thorough macroeconomic framework enables the federal and provincial governments as well as the private sector to take vital decisions in a timely manner.