ISLAMABAD – Painting a bleak picture of the economy, the government finally started sharing plans to improve how it functions with the parliamentary political parties to persuade them to support implementation of the crucial revenue and power sector reforms.
Finance Minister Dr Abdul Hafeez Shaikh, Petroleum Minister Naveed Qamar, Law Minister Babar Awan, Deputy Chairman Planning Commission Dr Nadeemul Haq and Minister of State for Economic Affairs Hina Rabbani Khar as well as senior officials of the ministry spent a busy day briefing delegations of the Awami National Party, Muttahida Qaumi Movement and Pakistan Muslim League-N on the state of the economy.
The team will also seek the PML-Q’s views. Sources told Pakistan Today that the parliamentary delegations were informed that the government would announce the restructuring plans for public sector enterprises (PSEs) next week as well as the formation of new autonomous boards of directors for these institutions.
The government team informed the delegations that there was no fiscal space left to absorb a Rs 20 billion per month power subsidy and Rs 5 billion subsidy on petroleum products. If remedial measures weren’t taken immediately, the fiscal deficit for the current fiscal year would be over 6 percent of the GDP or Rs 1 trillion. This would push the country to hyperinflation and make revival of the economy even more difficult.
The delegations were informed that this would put more funding to provinces in the NFC award at risk, sources said, adding that the parties were asked to support new revenue measures for smooth financial support from the centre.
Talking to the media after talks with the PML-N, the finance minister said that a four-hour-long session was held with the PML-N delegation led by Senator Ishaq Dar, in which “all issues were discussed. We were receptive to the ideas of our friends. We took them on board on the government’s performance”. Dr Hafeez Sheikh said that the president and prime minister had directed the finance team to pursue the talks and the difficult economic situation and the decisions taken by the government were shared with the delegation.
“We briefed them on the silver lining, as home remittances would cross Rs 10 billion while exports will surpass $ 20 billion this fiscal year.” The minister said the delegations were briefed on restructuring the public sector enterprises, resources and expenditure and that the talks would continue for a plan to tackle all the issues faced by the economy. “We will hold a follow-up meeting on the 20th of January while the final proposals will be shaped at a meeting on January the 26th or 27th”.
Asked if priorities had been short-listed, the minister said the government didn’t want to set an artificial time limit on anything and had decided that the talks process would be taken ahead with a positive approach so that both the parties could meet the people’s expectations.
Senator Ishaq Dar said the meeting had a detailed discussion on PML-N Patron Nawaz Sharif’s agenda, which he said had become a national one. He said agenda for the talks was one and his party wanted to carry the talks forward speedily. After the first round of talks, ANP leader Haji Adeel told the media he suggested that the government go on an austerity drive and eliminate corruption. Farooq Sattar of the MQM said his party would give its suggestions to the government.
