Pakistan to get extra funds from ADB, WB: Hafeez Sheikh

IMF package will bring sustainable economic growth: Finance Advisor

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ISLAMABAD: The prime minister’s finance adviser said Thursday the Assets Declaration Scheme 2019 brought to light the people who were not in the system earlier. Addressing a press conference here in the federal capital, Dr Abdul Hafeez Sheikh, the adviser to Prime Minister Imran Khan on Finance, highlighted that some 137,000 people were registered via the amnesty scheme.

People who were not in the system earlier were brought to light, Sheikh said. The purpose of the Assets Declaration Scheme 2019 was to bring people into the tax net in order to increase the number of people who pay taxes. That makes it, in terms of numbers, the scheme that registered the highest number of people, he added. Taxes paid totalled Rs70 billion, he explained, noting that a large number of those who contributed to this sum were those who were previously non-filers.

To date, assets worth almost Rs3 trillion have been declared, the adviser said. Our attempt now would be to take a step further and achieve the Rs5.5-trillion target. With regard to the three-year, $6-billion bailout package that the International Monetary Fund approved for Pakistan on Wednesday, Sheikh said it was called an extended fund facility and it can be returned in 10 years.

However, the IMF’s package is for three years, he noted, adding that Pakistan would receive $2 billion annually, whereas $1 billion would come in by July 8. The global financial body’s decision was important, the adviser said, and international institutions would be satisfied that Pakistan was provided support. We will make difficult decisions but we will protect the weaker class, he added.

Sheikh said Pakistan had approached the IMF in the past but that that did not prove to be long-lasting. Now, it is up to us to determine how to benefit from this aid, he said. What was agreed upon will soon be revealed, he added. With regard to the State Bank of Pakistan (SBP), he said more independence was given to the central monetary authority so that it can emerge as an international bank.

Adviser to Prime Minister on Finance Abdul Hafeez Shaikh reiterated the government’s objective of improving the country’s economic condition and revealed that various overseas bonds will be floated in the coming months. The adviser also discussed steps being undertaken to increase exports, thereby reducing the budget deficit and boosting sustainable dollar inflows.

The plan is to lift overseas shipments to $26.8 billion this fiscal year by granting subsidies and concessions on raw-material imports, said the de facto finance minister. Hafeez added that Pakistan is preparing for the sale of Eurobonds, Sukuk and Chinese Renminbi bonds during the fiscal year. The economy was in pretty bad shape. The idea was to shore up the external front. We have been able to mobilise resources, said the premier’s adviser.

Referring to the current economic situation of the country, he elaborated that Islamabad has received funds from Saudi Arabia, the World Bank and Asian Development Bank to help improve the current account deficit. We’re trying to focus on the business side and have realised that the private sector needs to play its role. All this can help Pakistan to avoid a debt trap, he concluded.

After the approval of $6 billion loan from International Monetary Fund, Special Advisor to Prime Minister on Finance Hafeez Shaikh said that the bailout package will bring stability to the economy. Sharing the details of the IMF package with media alongside Minister of State for Revenue Hammad Azhar, Shaikh said following the deal, other monetary organizations will also provide funds to the country. Asian Development Bank (ADB) intends to give additional $3.2 billion to Pakistan, he said.

The World Bank (WB) will also grant extra money to Pakistan, the advisor assured adding that these funds will also be given for the budgetary support. The approval of the bailout package reflected the trust of IMF in the leadership of Pakistan and its policies, he continued.

Shaikh admitted the historic swelling in the country’s debts and said we have to put efforts to pay our loans, we will have to cut our expenses besides taking difficult decisions to fix the economic situation. He said the monetary fund will provide $2 billion annually to Pakistan as a part of the $6 billion package and the first installment of $1 billion will be received by July 8.

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