Photo courtesy PID
Chairing meeting of economic team, premier invites recommendations from stakeholders to help revive country’s economy
Prime Minister Shahbaz Sharif on Tuesday decided to establish a National Economic Advisory Council comprised of leading, independent economists to steer the country out of its current financial crisis.
Chairing a meeting of the new government’s economic team, he sought proposals and recommendations on an urgent basis to help overcome the “serious threat” facing the country’s economy. “These proposals will take in account the views of agriculture, industry, investment, banking, and businessmen in addition to other stakeholders, for which a summit would be convened in the next few days,” read a statement issued by the Prime Minister’s Office.
It said that the prime minister had urged all economic experts to submit their recommendations on an urgent basis to help the government to overcome the economic challenges left behind by the Pakistan Tehreek-e-Insaf (PTI) government.
According to the statement, the meeting was given a briefing on the prevailing economic situation, revenues, the budget deficit, loans, and the overall national balance sheet by the finance secretary. It said that the prime minister had directed government officials to formulate immediate, short-term and long-term goals in light of the current economic crisis and serious financial risks to Pakistan. He also sought a reduction in the prices of daily-use commodities and essential items, particularly during the month of Ramzan, stressing the need to maintain a balance between national and public interests.
Per sources familiar with the meeting, the prime minister advised authorities to ensure the National Economic Advisory Council, once formed, meet at least once a week. He also said that once the federal cabinet had been formed, the government would formulate its own plans to overcome inflation and revive the economy.
Record deficit
Addressing a press conference after the meeting, PMLN leader Miftah Ismail, expected to be appointed the new government’s finance minister, said the country’s deficit had climbed to Rs. 5,600 billion. “This is the highest deficit in Pakistan’s history by far,” he said. “Earlier, the PTI government had predicted a deficit of Rs. 3,990 billion. Later a reporter disagreed and claimed it would stand at Rs. 4,300 billion, but I had said that it would move up to Rs. 4,600 billion. Unfortunately, I was wrong,” he said.
Slamming the PTI-led government for leaving the economy in such a precarious state, he regretted that the ousted regime’s policies had resulted in rampant inflation that was increasing daily. He took special aim at former prime minister Imran Khan’s decision to subsidize fuel and electricity when global commodity prices were peaking, stressing this was not sustainable.
“Statements [former] ministers made were erroneous as they cannot finance [the subsidy] on their own,” he warned. “The deficit is increasing by Rs. 373 billion [because of it],” he said, adding that Khan had announced the relief measures when he knew his government was nearing its end, as he wanted to leave a dangerous situation for the incoming government.
Similarly, Ismail condemned Khan’s subsidies to businesses, saying there was no need for any new amnesties.
To a question, the PMLN leader said the new government would try to negotiate a new deal with the International Monetary Fund, but noted that they were bound by all deals that the PTI-led government had inked with international financial institutions and would uphold them.