Finance Minister Muhammad Aurangzeb is rolling out the Economic Survey of Pakistan 2023-24 —a pre-budget document containing the details of major socio-economic achievements during the outgoing fiscal year.
“Pakistan rupee depreciated by 29% and the foreign exchange reserves went down to two weeks of import cover in fiscal year 2022-23 that is where we started off,” said the finance minister at the start of his press conference.
The finance minister said the country started off its journey to under take reforms under the leadership of Prime Minister Shehbaz.
“I was in the private sector before joining the finance minister but at that time I was clear that Pakistan had to go to IMF because we did not have any option and that’s why its called lender of the last resort,” he added.
“If Godforbids, we were not in the IMF, we would have not been discussing the targets here and in a very difficult situation.”
The larger-scale manufacturing growth was hampered due to the impacts of the interest rate regime and energy equation, the minister said adding that agriculture was the saviour backed by the bumper crops.
“Agriculture is going to remain a huge lever of growth as we go forward,” Aurangzeb said.
“On the fiscal side, as far as revenue is concerned, 30% growth was witnessed in the revenue collection which is almost “precedented” from the base where we started,” the finance minister said appreciating the provinces for delivering on their primary surpluses.
“[…] unless the provinces had delivered, we would not have been able to deliver what we committed to with the IMF under the 9-month SBA.”
The provinces should be given due credit for fulfilling their commitment,” he said.
The survey comes ahead of the federal budget for the fiscal year 2024-25, which is slated to be presented on June 12 (Wednesday).
The coalition government led by Pakistan Muslim League-Nawaz (PML-N) is expected to lay out ambitious fiscal targets in the Budget 2024-25 that will help strengthen its case for a new bailout deal with the International Monetary Fund (IMF), officials and analysts said.
Conceding severe financial constraints and cutting down on the development funding under the IMF programme, the Annual Plan Coordination Committee (APCC) has recommended Rs1,221 billion for development programme at the federal level for the financial year 2024-25.
It would be the first budget to be presented by the incumbent government.
As Pakistan strives to secure a loan programme to avert a default for a slow paced economy, the global lender has asked the country to raise provincial taxes, especially on agriculture, sales tax on services and property tax.
Pakistan is in talks with the IMF for a loan estimated to be anything between $6 billion to $8 billion to avert a default for an economy that is growing at the slowest pace in the region.
More to follow…
