‘Despite challenges, ailing economy stabilised’


Difficult economic decisions and reforms undertaken by the present PPP led government and despite challenges during past four and half years had produced positive results and ailing economy in the country had been stabilized and put on the path of economic resilience and growth.
Highlighting the major achievements of the government, a senior official of the Ministry of Finance told APP that the budget deficit had been brought down from 7.6 % of GDP in 2007-08 to 6.6% of GDP during 2011-12, while it has been estimated at 4.7% of GDP in FY 2012-13.
Advisor to Finance Ministry Rana Asad Amin said that due to tight monetary policy regime, inflation had been brought down from 25% in 2008 to 11% in FY 2011-12 and estimated at 9.5% during FY 2012-13.
He added that subsidies have been reduced from 3.5% of GDP in 2007-08 to around 1% of GDP in the budget 2012-13. He further said that due to stringent austerity measures adopted by the present government the expenditure on civil government has been reduced from 1.3% of GDP to 0.9 % of GDP.
Rana Asad Amin said that FBR collections increased from around Rs. 1157 billion in FY 2008-09 to Rs. 1908 billion in FY 2011-12 and estimated at Rs. 2381 billion in FY 2012-13.
He informed that workers’ remittances grew from US$ 7.8 billion in FY 2008-09 to US $ 13.2 billion in FY 2011-12.
“Exports increased from US $ 19.1 billion in FY 2008-09 to US $ 25.3 billion in FY 2010-11, stabilizing at US $ 24.6 billion FY 2011-12”, he remarked.
He said that the current account deficit of $13,874 million in 2008 was turned around into to a surplus of $423 million in Sept 2012.
Foreign exchange reserves, he said rose from a low of $ 7.5 billion in September 2008 to $18.2 billion in June 2011; currently they stand at around $14.4 billion.
He added that debt to GDP ratio has been kept within the statutory limit (Fiscal Responsibility and Debt Limitation Act, 2005).
The Advisor Finance Ministry said that Economic growth of 3.7% was achieved during FY 2011-12 and estimated at 4% during FY 2012- 13.
Regarding the Development spendings, he said that the Public Sector Development Programme (PSDP) over a period of 5 years was Rs. 3 trillion.
“Current financial year’s PSDP outlay is Rs.873 billion as compared to Rs668 billion last year”, he remarked.
He said that Rs 153 billion were earmarked under People’s Works Programme (Rs.118 billion under PWP-II and Rs.25 billion under PWP-I) in 5 years for implementation of hundreds of schemes for electrification, gas supply, road, water supply and sanitation.
Highlighting the employment situation during the past four and half years, Rana Asad Amin said that one hundred thousand internships provided since 2008 through the National Internship Programme while a large number of sacked employees were reinstated.
He added that the government facilitated employment of at least 660 thousand Pakistanis abroad and the ban on employment partially lifted.
He added that twelve thousand public sector contract jobs converted into permanent jobs while facilitation of self-employment through Waseela-i-Rozgar scheme under BISP was initiated to benefit the poor segment of the society.
Highlighting the resource transfer to the provinces, he said that under the 7th NFC Award gave due weightage to poverty/backwardness, revenue collection, revenue generation and inverse population density, in addition to population.
He added that transfer to the Provinces increased from Rs.633 billion in FY2009-10 under 6th NFC Award to Rs. 999 billion in FY2010-11, Rs.1,090 billion in FY 2011-12; and Rs. 1459 billion in FY 2012-13.
Rana Asad Amin added that it increased the share of Balochistan to 9.09 percent from 5.11% and seventy percent of the divisible pool is now being transferred to the Provinces and Special Areas, which reflects greater financial empowerment of the Provinces.
Regarding the steps taken for the Poverty Alleviation, he said that Rs. 138 billion allocated till end of FY 2011-12 to BISP; Rs.
70 billion have been budgeted in the current financial year 2012-13. He further said that under Benazir Employees Stock Option Programme, 12 percent shares of 80 State Owned Enterprises were transferred to 500,000 employees, making them shareholders in the respective PSEs.
He added that under Bait-ul Maal, more than Rs. 7 billion distributed to the poor over the past three years.
He added that Rs 52 billion provided to flood affectees under Citizens’ Damages Compensation Programme.
He added that present government’s Restructuring Public Sector Enterprises policy included induction of Professional Boards of Directors, Induction of professional management from the market, reconstitution of Boards of Directors of Power Sector Distribution Companies and restructuring of Steel Mills, PIA, PASSCO, Utility Stores Corporation and Trading Corporation of Pakistan.