Finance Minister Ishaq Dar said on Monday that after achieving economic stability, the government's focus in now on growth and acknowledged the downside risk to the economy is associated with the external balance of payment position. Speaking at an event "Emerging markets in the world economy", the Finance Minister recounted the condition of the economy when he assumed charge of Finance Ministry and the efforts he made to take the country out of economic morass.
He maintained that Pakistan Microfinance Investment Company would be established by the end of current year as Pakistan Poverty Alleviation Fund (PPAF) may not cater to the needs of everyone, adding the government was facilitating the private sector. The minister said that economic reform agenda undertaken by the government during the last three years has moved to the macro-economic stability road from a position of instability. He added that the major factor which led to the successful completion of the program was the election manifesto of the ruling government. The minister also said that Pakistan's economy continues to maintain its growth momentum above 4 percent for the third year in a row with real GDP growing at 4.71 percent in Fiscal year 2016, which is the highest in eight years; inflation has come down due to effective monetary policies, coupled with regular monitoring of prices both at federal and provincial level, as well as low international commodities and fuel prices. The present government also passed on the benefits of reduction in international oil prices to consumers, he added.
The minister stated the government's strong commitment to the poor and most vulnerable segments of our population is reflected in its social protection initiatives. This government has nearly doubled the budget allocated to Benazir Income Support Programme (BISP), Pakistan's largest social protection initiative, which has enabled increase in coverage from 3.7 million families to 5.6 million families, he added. In his welcome address, Governor State Bank of Pakistan Ashraf Mahmood Wathra said three years ago the country was under a balance of payment crisis which forced Pakistan to enter into an IMF's External Fund Facility Program (EFF). He said that three years ago economy was in bad shape with persistent energy deficiencies, declining development expenditures, rising inflation, and meager foreign exchange reserves. All these factors, he said resulted in the country's economic potential to decline and investor confidence was badly shaken. He also briefly mentioned financial sector reforms carried out to restore much needed macroeconomic stability and investors' confidence. He said policy measures ranging from amendment to fiscal responsibility and debt limitation act as well as autonomy to the SBP, anti-money laundering legislation and elimination of concessionary SROs, etc, reforms have been undertaken while being in the IMF programme. He said hat real GDP growth is poised to continue on an upward trajectory.
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