Govt announces Rs200bn package for exporters

Finance adviser says govt will also allocate additional Rs250bn to manage circular debt and Rs30bn for Naya Pakistan Housing Scheme

ISLAMABAD: The government has decided to announce a support package of Rs200 billion for exporters in order to enhance the country’s exports, encourage local production and create job opportunities, said Adviser to Prime Minister on Finance and Revenue Dr Abdul Hafeez Shaikh.

Addressing a press conference on Monday, the adviser said that the State Bank of Pakistan has decided to increase loans for the exporters by Rs100 billion.

The adviser was flanked by Special Assistant to Prime Minister on Information Dr Firdous Ashiq Awan, Economic Affairs Minister Hammad Azhar and Federal Board of Revenue (FBR) Chairman Shabbar Zaidi.

Hafeez Shaikh informed that the government would allocate additional Rs250 billion to resolve the problem of power sector circular debt. Furthermore, he added, the government would also allocate an additional amount of Rs30 billion for ‘Naya Pakistan Housing Scheme’.

“This amount will be utilised in term of various subsidies to be given to the builders,” he added.

The adviser said the stakeholders involved in the construction sector would be given special tax concessions.

“During the first four months of the current fiscal year, the government has achieved remarkable success on the economic front as the trade deficit has reduced significantly while forex reserves have been moving upwards,” he maintained.

The PM’s aide said after a big gap of five years, the country’s exports have started increasing now by 4pc, adding that FBR tax revenues have also grown by 16pc in four months compared to the same period of last year.

The finance adviser pointed out that cement production increased by 4.5pc which showed that the country’s construction sector was growing.

“The country’s exchange rate remained stable during first four months of FY20 while the stock market has also shown remarkable recovery,” he said, adding the government paid $2.1 billion debts obtained by the previous government.

He claimed that Pakistan’s economic sector has stabilised now, as endorsed by the international institutions including International Monetary Fund (IMF) and the World Bank.

“Last week, the IMF had praised Pakistan government’s efforts towards the introduction of economic reforms, saying that the country had met all the targets that were set by the IMF for its programme,” he remarked. “After the successful dialogue, the IMF has also approved for Pakistan the release of the second tranche of $450 million.”

To a query, Hafeez Shaikh said the pace of economic growth in the country would be increased further in the coming days and the economic growth rate target set by the government for the year 2019-20 would be easily surpassed.

To another question, he said the government has allocated a record Rs152 billion for the development of erstwhile FATA during the current fiscal year.

On a question regarding discount rate, the adviser said that the determination of discount rate was the job of the SBP’s monitory policy committee and that the government has given full independence to the central bank in this regard.

The adviser said the government had decided not to borrow money from the SBP due to which Pakistan did not print even a single rupee during the last four months.

He said the government was fully committed to controlling the prices of essential daily use items. “We are also taking steps to minimise the role of middlemen due to which the prices of food items surge by the time they reach the end consumers.”

The government, he said, has also decided to provide Rs6 billion to utility stores to ensure availability of essential daily use items at subsidised rates.

To a query, he said the previous government wasted $20 to $25 billion of the nation only to artificially maintain the exchange rate of Pakistan.

“During the last four months, the price of petrol price has not been increased despite the fact that its price in the international market has been going up,” he added.

Ghulam Abbas
Ghulam Abbas
The writer is a member of the staff at the Islamabad Bureau. He can be reached at [email protected]

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