LAHORE: Pakistan’s economy is now on a sustained growth path but it faces challenges due to the reversal of reforms after the Panama Papers case, which has increased the fiscal deficit to an unmanageable level.
This was stated by former finance secretary Dr Waqar Masood Khan while speaking with media in Lahore.
He said the PML-N government moved the economy up gradually from an average growth of less than 3% during 2008-13 to 5.8% in the first nine months of the current fiscal year. He said the housing sector is buoyant, car sales are growing at above 28% and inflation has hovered at 3.2% in the first nine months of this fiscal year.
Khan said prudent government policies have been complemented by a favourable global commodity situation.
“The agriculture sector posted a growth of 3.5% that has kept food prices in check, followed by a healthy investment by both public and private sectors.”
However, he said that current account and fiscal deficits are a major challenge to the economy. “We have to maintain our foreign exchange reserves as we fulfil 90% of our energy needs through imports,” he added.
Regarding the tax amnesty scheme, Khan said that the huge concession given to the income of up to Rs1.2 million would wipe out 50% of the taxpayers. He said this concession would mean a tax concession of Rs150 billion.
Regarding the amnesty granted to overseas Pakistanis, he said that since the corrupt have been excluded from the scheme it would get a favourable response from the FATF. He said OECD countries are tightening their noose against ill-gotten money stashed by foreign nationals.
Published in The Express Tribune, April 11th, 2018.