Pakistan Prime Minister Shehbaz Sharif has said that without political stability, there would be no economic stability as he invited all stakeholders to join hands in formulating a long-term plan – a Charter of Economy – to revive the cash-strapped country’s ailing economy.
Addressing a Pre-Budget Business Conference in Islamabad on Tuesday night, Sharif said the enhancement of exports and agricultural yield, and financial management should be the major components of the plan.
“I’m asking for a prudent and comprehensive approach for an economic turnaround…That is why I am asking all stakeholders to meet the challenge of time to turn the country’s economy around,” he was quoted as saying by the state-run Associated Press Pakistan.
“No matter what happens, whichever party comes into power, the goals set in the ‘Charter of Economy’ will remain unchanged. It will become our sacred trust, which will not change. We need this,” he told the conference attended by top industrialists, agriculturists and economists, who gave suggestions to steer the country out of an unprecedented economic crisis.
He said that it was important to understand that without political stability, there would be no economic stability and stressed on the need for a charter of economy.
Sharif stressed that enhancement of exports, agricultural yield and financial management should be the major components of the plan. “The government will form a task force on agriculture and exports for formulating comprehensive plans,” he said.
He said that Pakistan lagged behind because of the non-execution of development plans, while other nations like India excelled.
“Being rich with resources, human talent and dedication, Pakistan can also achieve excellence through efficiency and modern techniques,” he added.
The prime minister called for the use of modern technology in the field of agriculture and boosting the performance of the industries and exports. He announced that he would set up a task force to work in these areas.
He stressed the need for developing the rural areas, which was home to 65 per cent of the country’s population, saying movement from underdeveloped to the developed areas put strains on the resources of cities. “This can only happen when our children get quality education there.” Sharif mentioned that after the 18th Amendment, provinces were empowered and the Federation’s powers were devolved. He said that the provinces and the Centre would have to work together to develop a comprehensive plan.
Comparing the country’s information technology (IT) industry with that of India’s, the prime minister said that the latter generates around USD 200 billion, while Pakistan’s industry was hovering around USD 2.5 billion. “We must go for special export industrial zones,” he said.
Talking about the tough decisions being taken by the government, Prime Minister Sharif said that the non-productive assets should be taxed. “The windfall profits in the real estate should also be taxed,” he said.
With the economy in tatters and political instability looming large due to protests by former prime minister Imran Khan, there is increasing threat of Pakistan going the Sri Lankan way if quick measures are not taken.
Pakistan’s foreign exchange reserves are under severe stress and declined by USD 190 million to USD 10.308 billion during the week ended on May 6, according to the State Bank of Pakistan (SBP).
The country is heavily dependent on foreign loans but they are not easy to come by. The Ministry of Economic Affairs data last month showed that Pakistan received only USD 248 million in foreign loans in April, including USD 100 million worth of oil on deferred payments from Saudi Arabia.
Pakistan is looking towards the International Monetary Fund (IMF) to restore a USD 6 billion package agreed in 2019. So far half of the promised money had been given. Pakistan would immediately get a USD 1 billion loan tranche from the IMF once the two sides sort out differences.
Separately, Radio Pakistan reported that addressing the same conference Sharif talked about the foreign policy and said the previous government has damaged relations with friendly countries, but the incumbent government is taking practical steps to restore mend the strained ties.