Govt sets ambitious target of 5.5% average GDP growth rate during its 5 year tenure

The minister feels that the target is easily achievable just through CPEC related projects.

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ISLAMABAD: Minister for Planning, Development and Reform Makhdum Khusro Bakhtyar informed the National Assembly that the Pakistan Tehreek-i-Insaf (PTI) government has set a target to achieve average gross domestic product (GDP) growth rate at 5.5% during its five years’ term.

“The economic growth rate will gradually increase to 6.5% in the last year of its tenure,” he said while taking part in the budget debate in the National Assembly.

The minister said the Pakistan People’s Party government (2008-2013) had created some 6.9 million jobs with an average GDP rate of 2.8%, and the Pakistan Muslim League (PML-N) created only 5.7 million jobs despite a comparatively higher GDP growth rate of 4.6%. “Under the dynamic leadership of Prime Minister Imran Khan, the PTI-led government is determined to create 10 million jobs during its five-year term,” he added.

He also questioned the veracity of economic growth rate figures announced by the PML-N government, saying it had deliberately fudged the figures of economic indicators just to show higher growth for its vested interests. 

He said the previous government had recklessly taken debts, increasing the country’s debt to GDP ratio from 64% to 86%. He blamed the previous government for taking a debt of $34 billion despite record low petroleum prices in the international market during their tenure which according to him had a windfall of $32 billion for Pakistan’s economy. “With the huge fiscal space created by low petroleum prices, the PML-N government could have easily brought the country out of the economic crisis, but instead PML-N plunged the economy into a deep crisis,” he added.

He said when the PTI government took charge, the current account deficit stood at $20 billion which was at the highest level in the country’s history, while the fiscal deficit was also touching historic high. The budget deficit, he said, was recorded at Rs 2.3 trillion.

He claimed that due to the credibility of Prime Minister Imran Khan, Pakistan managed to seek $9.2 billion foreign support in a short span of time. “We managed to bring down the current deficit from $20 billion to less than $12.5 billion in 10 months.”

Bakhtyar said the PTI government was forced to approach the International Monetary Fund (IMF) only to bridge the current account deficit created by the previous government. After going to the IMF for the 18th time, the nation must resolve and support the government to ensure that this would be the last programme, he added.

The minister said the government had to increase the interest rate to boost national savings which would help enhance business activities in the country. He said keeping in view the lowest tax to GDP ratio of 11% in the region, the government has set an ambitious target of tax revenues of Rs 5.55 trillion which would help increase the tax to GDP ratio.

If the federal revenue collection target was achieved, Sindh province alone would get an additional Rs 200 billion as its share from the divisible pool during the upcoming year, which, he hoped, would be judicially spent in all areas of the province.

He said the work on Sukkur-Hyderabad motorway would be initiated during the current year in partnership with the private sector under the Built-Operate-Transfer (BOT) which would help the government save Rs 300 billion from the PSDP allocation.

He said China Pakistan Economic Corridor (CPEC) possessed huge scope and the government could easily achieve the economic growth target by fully focusing on it.

Bakhtyar said that the government had set aside record Rs 951 billion under the PSDP in 2019-20 and the second most recipient of the development budget was Balochistan, while less developed areas of Khyber Pakhtunkhwa, Southern Punjab, and rural Sindh have also been given their due share.

As regards the development of the agriculture sector, the minister said Rs 13 billion has been earmarked while during the previous years’ development budget, the agriculture sector had got only Rs 1 billion.

On the contrary, Ahsan Iqbal of the PML-N  said that last year the government had set aside Rs 34 billion for the agriculture sector while the current government had reduced the budget to Rs 5 billion. Bakhtyar denying Ahsan’s claim while also changing the numbers he himself gave earlier, said, “I stand by my words that the previous government had allocated Rs 1 billion for the agriculture sector while under the Public Sector Development Programme 2019-20, the PTI government has allocated Rs 12 billion for the sector.” 

Speaking on the importance of charter of economy, the minister said it was the need of the hour to constitute a committee comprising parliamentarians from all the political parties to set the targets to take the economy to new heights.

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