Tarin underscores need for ‘interim’ setup to deal with myriad economic challenges

KARACHI: Former Minister for Finance Shaukat Tarin has said that the economic performance of PTI government was much better than that of present coalition government which he claimed has completely failed to resolve the economic issues.

While addressing a press conference along with Muzzammil Aslam, PTI spokesman on Economic Affairs here on Sunday at his residence in Karachi, Tarin urged for setting up an interim government and assured his full support to the interim government to overcome the ongoing economic crisis.

“With poor performance of the present government, Pakistan is gradually moving towards the bankruptcy and there is a need to immediately form a strong interim government to hold general elections. We will fully support the interim government, but not this government, to bring the economy on the right track”, he said.

Presenting the performance statistics of the PTI government, he informed that the country’s GDP growth is projected at 6 percent in FY22, remittances and exports were increasing, current account and fiscal deficit was on decline and large-scale manufacturing growth was almost doubled during the tenure of PTI government.

Tarin said that the present government has even failed to negotiate with the IMF for release of the next loan tranche to overcome the ongoing crisis. He also criticized the recent ban on imports and said that there is no need to impose a ban on import of a number of goods.

Tarin claims PTI govt never promised IMF to end subsidy

In order to reduce the import bill, a ban should be imposed on two or four major importing items like cars and mobile phones. The unplanned ban on imported items has created panic in the market. “We believe that current measures will increase the smuggling of goods and dollar demand will remain the same in the domestic market,” he added.

He said that the PML-N government has also failed to curb the inflation and despite the availability of commodities, the prices are on a surge. “Previously, we were conducting meetings on a weekly basis for monitoring of prices to control the inflation; however, the present government has not held a meeting on price in the past six weeks, of which the hoarding mafia is getting benefits by increasing commodity prices”, he added.

Former Finance Minister said that the present government’s budget estimate for next fiscal year is about Rs 7.2 trillion while PTI was planning for a budget of over Rs 8 trillion for FY23.

He said that health facilities worth one million rupee through health card, Kamyab Nojawan program for entrepreneurs and Ahsas program for poor families were some of the successful stories of public welfare programs initiated by the PTI government.

Tarin informed that central government debt was Rs 25,042 billion in 2018 and now it stood at Rs 42,994 billion and debt as percentage of GDP remained stable at 64 percent. While tax refunds increased by 109 percent to Rs 322.6 billion in March 2022 up from Rs 154.7 billion in August 2018.

Almost production of all crops moved upward side and wheat production rose by 9 percent to 26.4 million metric tons, with 25 percent growth rice production surged to 9.3 million metric tons, maize crop production increased by 64 percent to 10.6 million metric tons, sugarcane production 83.3 million metric tons to 88.8 million metric tons and sugar production rose by 15 percent to 7.5 million tons in FY22.

He said that major Pak Rupee depreciations were recorded in the tenure of PML-N and PPP governments. Exchange rate was Rs 61 in 2008, Rs 122 in 2018 and Rs 178 in March 2022, he mentioned.

During the tenure of the PTI government, exports surged by 30 percent to $32 billion (projected) for FY22 and remittances 60 percent to $31.3 billion (projected) for FY22. Imports raised by 20 percent due to commodity super cycle, despite the Covid-19 vaccine import and higher commodity prices that pushed the import bill, the current account deficit declined to $15 in FY22 from $19.2 billion in FY18. Current Account percentage of GDP stood at -4 percent in March 2022 compared to -5.8 percent in August 2018.

Tarin further informed that during the August 2018 to March 2022, tax collection rose by 60 percent to Rs 6.1 trillion, the country’s foreign exchange reserves rose by 77 percent to $11.42 billion in March 2022 up from $9.8 billion in August 2018.

GDP size increased by 21 percent to $383 billion or Rs 67 trillion in March 2022 as against $317 billion or Rs 39 trillion in August 2018. Per capita income increased from $1,768 to $1,798. On the external debt stock side, 135 percent improvement in net accumulation of debt and external debt stood $128.9 billion, he mentioned.

Tarin said that due to instability in the country the stock exchange is continually falling as the investors are withdrawing their investments, while competent officers and heads of government departments are being removed by the present government.

Copyright Business Recorder, 2022