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* Finance minister says GDP for FY 2011-12 likely to be around 4%
* Prime minister briefed on biannual performance of economy
By Sajid Chaudhry
ISLAMABAD: Pakistan will start repaying the $7.6 billion International Monetary Fund (IMF) loan next month, with the first tranche of $1.2 billion that has been allocated in the budget 2011-12.
Finance Minister Dr Abdul Hafeez Sheikh and Finance Secretary Dr Waqar Masood called on Prime Minister Yousaf Raza Gilani here at the Prime Ministers House and briefed him on the performance of the economy from July to December 2011.
The Pakistan Peoples Party (PPP) government had reached a deal of $7.6 billion stand-by-arrangement (SBA) loan programme with the IMF in 2008, which was later enhanced to $11.3 billion to ease out its balance of payment position.
However, due to political constraints, the government was unable to implement key benchmarks agreed with the IMP, like enforcement of general sales tax (GST) on goods and services in integrated mode, elimination of power sector subsidies, bringing the central banks borrowing to a desired limit, and keeping the budget deficit within the agreed limits.
These policy inactions resulted in the suspension of the IMF programme in May 2009, and the programme was terminated in September 2011.
During the meeting, the prime minister said he would soon give a policy statement in parliament about the economy and achievements of the government in this regard.
The finance minister said the gross domestic product (GDP) for Fiscal Year 2011-12 was expected to be around four percent. He said that it was for the first time after 24 months that inflationary pressures had started to recede in December as compared to preceding year.
All three price indexes - consumer price index (CPI), wholesale price index (WPI) and sensitive price index (SPI) - came down to a single digit range, adding that the SPI fell as low as three percent.
The minister said the external sector of economy continues to give strong performance. Exports, which registered an impressive achievement of $25 billion last year, continue to grow and increased by four percent in the first six months of the current fiscal year as compared to the same period last year, the minister said.
Dr Sheikh said that remittances during the same period increased by 19 percent, averaging more than $1 billion a month. He said that government measures to increase tax revenue had shown remarkable growth, as during the first six months of the current fiscal year, the Federal Board of Revenue collected Rs 840 billion, showing a remarkable increase of 27 percent as compared to last year.
He further said that the government also continued to exercise strict control on the expenditure side, as the total expenditure during the first half of the current financial year was kept below 50 percent of the amount allocated.
The minister informed PM Gilani that foreign exchange reserves remained above $17 billion. He said the government would pay back a tranche of $1.2 billion to the IMF next month.
The PM was apprised of the upcoming auction of 3G Spectrum and mobile licence, which has already been advertised, and transactions would be undertaken within the next few weeks.
It was also informed that the government would receive $2.5 billion in foreign exchange in the coming months, from Etisalats pending dues, Coalition Support Fund from the US, and auction of 3G Spectrum Licence.
Dr Sheikh also said that the government must be credited for some of the outstanding measures taken for the improvement of the poor, like the provision of Balochistan Package, funding to the Gilgit-Baltistan and AJK, and the alleviation of the poor through the Benazir Income Support Programme.
The minister said that keeping in view the prevailing gas crisis that has crippled the fertiliser sector, the government had decided to import 1.2 million tonnes of fertiliser. He said the step would be taken to provide relief to the poor farmers, who otherwise would be affected adversely due to the shortage. He said the farmers would also be provided a subsidy of Rs 40 to 50 billion on fertiliser.
The PM was also briefed on the progress made in the Public Sector Development Programme (PSDP), for which over Rs 100 billion had been released to complete the projects of electricity, highways, water and other areas of national priority
Daily Times - Leading News Resource of Pakistan
* Prime minister briefed on biannual performance of economy
By Sajid Chaudhry
ISLAMABAD: Pakistan will start repaying the $7.6 billion International Monetary Fund (IMF) loan next month, with the first tranche of $1.2 billion that has been allocated in the budget 2011-12.
Finance Minister Dr Abdul Hafeez Sheikh and Finance Secretary Dr Waqar Masood called on Prime Minister Yousaf Raza Gilani here at the Prime Ministers House and briefed him on the performance of the economy from July to December 2011.
The Pakistan Peoples Party (PPP) government had reached a deal of $7.6 billion stand-by-arrangement (SBA) loan programme with the IMF in 2008, which was later enhanced to $11.3 billion to ease out its balance of payment position.
However, due to political constraints, the government was unable to implement key benchmarks agreed with the IMP, like enforcement of general sales tax (GST) on goods and services in integrated mode, elimination of power sector subsidies, bringing the central banks borrowing to a desired limit, and keeping the budget deficit within the agreed limits.
These policy inactions resulted in the suspension of the IMF programme in May 2009, and the programme was terminated in September 2011.
During the meeting, the prime minister said he would soon give a policy statement in parliament about the economy and achievements of the government in this regard.
The finance minister said the gross domestic product (GDP) for Fiscal Year 2011-12 was expected to be around four percent. He said that it was for the first time after 24 months that inflationary pressures had started to recede in December as compared to preceding year.
All three price indexes - consumer price index (CPI), wholesale price index (WPI) and sensitive price index (SPI) - came down to a single digit range, adding that the SPI fell as low as three percent.
The minister said the external sector of economy continues to give strong performance. Exports, which registered an impressive achievement of $25 billion last year, continue to grow and increased by four percent in the first six months of the current fiscal year as compared to the same period last year, the minister said.
Dr Sheikh said that remittances during the same period increased by 19 percent, averaging more than $1 billion a month. He said that government measures to increase tax revenue had shown remarkable growth, as during the first six months of the current fiscal year, the Federal Board of Revenue collected Rs 840 billion, showing a remarkable increase of 27 percent as compared to last year.
He further said that the government also continued to exercise strict control on the expenditure side, as the total expenditure during the first half of the current financial year was kept below 50 percent of the amount allocated.
The minister informed PM Gilani that foreign exchange reserves remained above $17 billion. He said the government would pay back a tranche of $1.2 billion to the IMF next month.
The PM was apprised of the upcoming auction of 3G Spectrum and mobile licence, which has already been advertised, and transactions would be undertaken within the next few weeks.
It was also informed that the government would receive $2.5 billion in foreign exchange in the coming months, from Etisalats pending dues, Coalition Support Fund from the US, and auction of 3G Spectrum Licence.
Dr Sheikh also said that the government must be credited for some of the outstanding measures taken for the improvement of the poor, like the provision of Balochistan Package, funding to the Gilgit-Baltistan and AJK, and the alleviation of the poor through the Benazir Income Support Programme.
The minister said that keeping in view the prevailing gas crisis that has crippled the fertiliser sector, the government had decided to import 1.2 million tonnes of fertiliser. He said the step would be taken to provide relief to the poor farmers, who otherwise would be affected adversely due to the shortage. He said the farmers would also be provided a subsidy of Rs 40 to 50 billion on fertiliser.
The PM was also briefed on the progress made in the Public Sector Development Programme (PSDP), for which over Rs 100 billion had been released to complete the projects of electricity, highways, water and other areas of national priority
Daily Times - Leading News Resource of Pakistan
