Pakistan Business Council (PBC) has proposed National Economic Agenda (NEA) for revival of the economy to increase the production level and raise the living standard of all citizens.
The adoption and implementation of NEA would lay the foundation for sustained annual GDP growth in excess of six percent touching eight percent, as reforms will put in place a virtuous cycle of increased savings and investments, reduce inflation to a single digit level, reduce unemployment rates, bring substantive reduction in poverty through a combination of reduced inflation, higher job creation, significantly increased targeted social protection programs and skill development of the people as well as elimination of load shedding and gas shortages, claimed PBC.
According to the report "position of major political parties on (NEA) filed by PBC the initiative was aimed at facilitating dialogue among major political parties on a minimum 'Economic Agenda'. To achieve the above PBC has identified the following five reform areas that need to be urgently addressed:
Energy for growth: it is proposed in NEA that (i) urgent decisions needed to fast track the import of LNG (ii) carry out an urgently needed revamped programme for the existing assets in the power generation and distribution system (iii) rationalisation of price distortions between different fuel sources and different consumption segments (iv) revisit the gas prices being offered to E&P companies to encourage accelerated exploration and development of indigenous gas resources, (v) carryout focused development work on other indigenous fuel sources particularly hydel and Thar coal (vi) put in place a structured programme to deregulate the energy sector in next 3-5 years (vii) have an integrated energy ministry which, with the help of the best professionals available in the field and (viii) should oversee the implementation of an integrated energy plan.
For regional trade as a growth driver it is proposed that (i) revisit the national security paradigm especially with respect to regional trade (ii) develop a strategy for trade policy to use it to strengthen linkages with our neighbours and beyond (iii) the strategy to also include a policy to promote transit trade (iv) invest in supporting infrastructure (v) grant India MFN status (vi) use the Safta framework to address non tariff barriers on both sides and (vii) creation of an environment which fosters cross border investments.
For better macroeconomic management of the economy the NEA proposed (i) reduction in the fiscal deficit to three to four percent of the GDP in the next three years through (a) increase in the Tax-to-GDP ratio to 15 percent in the next five years through better collection of existing taxes and a reform of the tax system by adopting the principle of taxation regardless of source of income (b) bringing all sectors into a uniform documented tax net (c) setting a target of 10 percent reduction in public sector waste both at the federal as well as the provincial level through implementation of the recommendations of the National Commission on Government Reforms (ii) eliminating Public Sector Enterprise (PSE) losses by empowering professional boards and management to reform and restructure these institutions without political interference as well as (iii) eliminating non targeted subsidies and phasing out the role of government in commodity operations.
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