ISLAMABAD: Special Assistant to Prime Minister on Revenue and Federal Minister Haroon Akhtar Khan said on Thursday that the government is aiming at a 6 per cent GDP growth this year on the basis of strong economic indicators.
“Our economy has done very well and we are aiming for 6 per cent GDP growth this year as reflected by the low inflation rate which is below 4 per cent and fiscal deficit which is around 5 per cent,” he said while talking to a delegation of Turkish investors and businessmen, who as part of the Turkish-Pakistan Business Council met him at the FBR House.
The minister told the visiting delegation that Pakistan has gone through some rough times in the past, facing the spread of terrorism mostly due to international problems, but Pakistanis have proved to be a very resilient nation.
“Five years ago the situation was not what it is today. The situation is very good now. We have proved to the world that we are a frontline nation in the fight against terrorism. We have made a lot of sacrifices. We had a slight political turmoil because of which stock market went down but it has come back again,” he commented.
Haroon Akhtar Khan said that he had met a number of businessmen, trade associations and chambers of commerce, including Pakistan Business Council and Overseas Investors Chamber of Commerce, and they always told him that people were eager to invest in Pakistan.
“They come to tell me that profit margins are going up, their business volumes are going up. The fast-moving consumer goods are doing very well. That is the strength of our economy. Our international ratings have been improving consistently. Today is the right environment to come to Pakistan,” he added.
He further told Turkish businessmen that Pakistan has a population of over 200 million people out of which 65 million are below the age bracket of 30. “This youth bulge is our strength and that is what we can use in the future.”
He conceded that Pakistan has to go through the industrialisation route before aspiring to become a fully developed country. “We believe that we need a lot of jobs for the skilled as well as the unskilled labour. Our people go and work all over the world. They work 18 hours a day, live a very simple life and send valuable money back home which helps our economy. We are a resilient people and our labour as compared to many countries around us is also considerably cheap.”
He apprised the delegation that the corporate tax rates in Pakistan had come down from 35 per cent to 30 per cent and the government is further reviewing them in the coming budget. However, there are many other advantages to reap for the foreign investors in Pakistan. “We have no inheritance tax, no gift tax, no wealth tax and almost negligible social security tax which is very small as a percentage of salaries. These are the advantages for the foreigners who can own 100 per cent of their company, can bring investment through their offshore concerns and can own properties here.”
He conceded that there is a culture of red-tapism in the country but that is getting better. “We are not very high in the ease of doing business index but we are working on that. We like businesses to prosper. We do not want to tax them to a point where they stop making money. What we want is that while businesses are going strong and making money, the government also makes some money,” he further commented.
He said the government held the companies in the highest esteem by trusting them and believing in their balance sheets. “We give special treatment to the multinationals and large taxpayers because we know they pay their taxes.”
He said that while there could be problems with regard to systems and procedures but the government is ready to help out the investors in all possible ways. “I understand that for a company coming here, the consistency of policies is very important. Obviously, companies make feasibility policies on the basis of prevailing policies and if those policies change, that too negatively, that is disheartening for the investors.”
He said that previously there were problems with the current account deficit caused by trade deficit and lack of foreign investment but Pakistan’s economy is in a better shape now. “We have done very well as far as the CPEC is concerned, the Chinese investment amounts to $57 billion over the next four to five years. However, more investment together with exports would take care of our trade and current account deficit. We don’t want to go to the donor agencies and the IMF because we want to achieve 7 to 8 per cent GDP growth,” he further stated.
The Turkish investors and businessmen thanked the minister for briefing them on the state of the economy and the investment opportunities available in Pakistan.
They told the minister that they have set up their businesses for many years now and can see for themselves vast improvements in the security situation and an increasing level of credibility that Pakistan now enjoys as an investment destination abroad.
They also told the minister that there were many more Turkish companies and businessmen keen to come to Pakistan due to improvement in the investment environment here, particularly the overcoming of energy shortages and the overall situation the country.