ISLAMABAD, Feb 24 (Alliance News): Minister for Finance and Revenue Shaukat Tarin on Thursday said that the government’s endeavors in rectifying the past government’s wrong economic policies, which put the country’s economy on verge of collapse, started yielding results as all the macro economic indicators were showing positive performance.
Addressing a seminar titled “Investment, Industrialization, and Exports: harmonizing sectoral efforts for growth” here, the minister said a Gross Domestic Product (GDP) growth of 5.4 percent last year was reflective of the government’s sincere work in bringing structural reforms in various sectors of the economy.
“Our current years’ economic growth would also touch the five percent mark that depicts we are on the trajectory of sustainable growth,” he added.
Mr Tarin said Pakistan had potential of even higher growth as “we have a great strength (60 pc) of young population, a diversified landscape, and a large pool of non-resident Pakistanis sending remittances worth billions”.
He said the government had to face four major crisis during its tenure including inheriting huge current account deficit, COVID-19 pandemic, Afghanistan issue, and the international commodity price hike. However, he said despite all these challenges, the government managed to set the country’s economy on the path of growth trajectory.
The minister said at present the savings rate in Pakistan is only 14-15% and the tax to GDP is 10% that is not enough to achieve the sustainable growth target. “With current savings and tax rates, we can not surpass the GDP growth rate by 4 pc and if we do, we will have to borrow more,” he added.
He said the government would have to raise the savings and tax to GDP ratios up to 25 pc and 20 pc respectively.
The minister maintained that the government had introduced a coherent industrial policy to promote the export oriented manufacturing in the country.
Shaukat Tarin said the gap between exports and imports was as high as $40 billion which must have to be reduced to minimum in order to bring down the current account deficit.
He said production of major crops in the country that were stagnant for last 7-8 years had not started increasing due to the government’s pro-farmer policies.
He said the government was embarked on promoting investment climate, ease of doing business, rationalization of regulations, and shifting toward digitalization.
Meanwhile, Minister for Industries Makhdoom Khusro Bakhtyar said the government was providing tariff protection and tax incentives especially to the foreign investors to increase foreign direct investment that subsequently lead to increase in the country’s exports.
He said due to the government’s vision of import substitution, the manufacturing of mobile phones had surged in the country saving billions of dollars of foreign exchange reserves.
He said the government was also working on a balanced nutrient fertilizer policy to ensure food security in the country.
Advisor to Prime Minister for Climate Change Malik Amin Aslam said the environment friendly investment was being promoted in the country as what he said Pakistan had no other way but to have an environment friendly future.
He informed that by end of current year, some 100 institutions would shift to zero carbon.
Chairman Board of Investment Azfar Hassan, Deputy Chairman Planning Commission Dr Jehanzeb Khan, and a representatives of UK High Commission also spoke on the occasion.