Pre-budget: EAC seeks short-term recommendations from sub-groups

EAC to reconvene in second week of May to deliberate over recommendations by the sub-groups of EAC.

ISLAMABAD: With the end of the fiscal year just two months away, the Economic Advisory Council (EAC) and all of its sub-groups met on Saturday to present proposals to minister for finance Ishaq Dar.

In the marathon 390 minute meeting on Saturday, aspects of the economy were discussed.

Dar said that within the constitutional and legal mandate of the government, recommendations of the sub-groups, which are doable, will be included in the next federal budget.

Energy

The sub-group on energy, headed by Farooq Rahmatullah, presented its proposals related to oil and gas sector with an aim to achieve lower cost of energy and to become self-sufficient in our needs.

The proposals included building strategic reserves of POL products, deregulating oil marketing and distribution, bringing price parity between competing fuels, enhancing exploration of oil and natural gas, encouraging exploration companies investment and prioritising natural gas distribution to power generation and industry sector.

The sub-group further recommended a holistic privatisation plan for DISCOS and bringing down government subsidy in the energy sector.

Industry and trade

Sub-group on industry and trade, headed by A Razak Dawood, recommended diversification of export base, moving prime focus away from textile and rice and promoting non-agriculture based export industry including engineering, IT, chemicals and food processing.

The sub-group highlighted that GSP plus status is not just for textile and it includes all products. It recommended making Pakistan hub of exports from engineering and chemical sectors.

The strategy of phasing out SROs and protection while maintaining a level playing field was appreciated.

Food security

Sub-group on food security, agriculture, headed by Dr Abid Qayuim Suleri, presented a briefing on the state of food security in the country and recommended establishment of a special task force on social safety nets which should give recommendations to integrate and reform the existing social safety nets to enhance their collective impact.

It recommended a school feeding programme, special nutrition programmes, stimulus programme to expand farm outputs and market access, storage of essential food items, oil crop cultivation, cheap credit to agricultural sector and rationalising market prices of essential food commodities.

The sub-group appreciated the fiscal measures taken by the ECC for bringing down the prices of potato in the market.

Resource mobilisation, expenditure management

The sub-group on resource mobilisation and expenditure management, Arshad Zuberi, gave a detailed presentation on resource generation and transparency, allocation and management of expenditure.

It was decided that the sub-group will present short and medium term measures which could be incorporated in the next budget and over a period of three years respectively.

Social sector

The sub-group on social sector, Dr Sania Nishtar, proposed recommendations on education, health and social protection sectors for incorporation in the next budget and for medium term reforms.

The sub-group pointed out that after 18th Amendment and devolution of subjects to the provinces, there are areas in which the federal government can take initiative for the public benefit.

Dr Ishrat Hussain, convener of the EAC, said that the conveners of the each sub-group should solidify their recommendations meant for the next budget and submit to the IERU of the finance division by first week of May, 2014.

While medium term recommendations will be discussed after budget, it was decided that the next meeting of EAC will take place in the second week of May, 2014 to discuss the final recommendations of the sub-groups.

Minister for Petroleum and Natural Resources, Shahid Khaqan Abbasi, Federal Secretaries, Members of the Economic Advisory Council and senior officials of the Finance Ministry attended the meeting.