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Budget for FY23 to be presented on Friday

The government is all set to present a pro-people, business-friendly and progressive budget for the next fiscal year 2022-23 in the Parliament tomorrow with a special focus on fiscal consolidation to contain the budget deficit.

Minister for Finance Miftah Ismail will present the budget in the National Assembly.

The budget has been formulated while considering the existing challenges being faced by the economy at domestic and international fronts.

Earlier, unveiling the important budgetary document of ‘Pakistan Economic Survey 2021-22’ on Thursday, Minister for Finance and Revenue Miftah Ismail termed the GDP growth rate of 5.97 percent during the outgoing fiscal year unsustainable as the country needed to stabilize the economy before moving towards sustainable growth.

He said the country witnessed a higher economic growth during the year, which resulted in the Current Account Deficit (CAD) to soar to a level where the government had no option but to slow down the economy to control the CAD.

Addressing a press conference after launching the economic survey, the minister said the growth rate was according to the new base year. “Had it been based on the old base year, the GDP (gross domestic product) growth rate would have been lower.”

Flanked by Minister for Planning Ahsan Iqbal, Minister for Power Khurrum Dastgir, and Minister of State for Finance Ayesha Ghous Pasha, Miftah said during the current fiscal year, the imports increased by 48% to $75 billion whereas the exports rose by 28 percent.

The government could manage to pay only 40% of the import bill out of the exports’ earning, while the rest was footed from other sources, including loans, he added.

The finance minister said due to cheap prices of the commodities and petroleum products during the COVID-19 pandemic, the balance of payment (BoP) situation eased off and foreign exchange reserves climbed up.

When the prices started going up, the previous government failed to manage the BoP situation, and resultantly the foreign exchange reserves plunged to below $10 billion again, which was not an encouraging sign, he added.

The reserves, however, were going to rise above $12 billion within a week due to inflow of US$2.4 billion from China, the minister said.

Miftah said in order to streamline the economy, the coalition government had to take tough decisions to save the country from default. With the difficult decision of raising the petroleum prices by Rs 60 per liter, “We have managed to avert an imminent default. Now we will move towards the stability stage and then towards the sustainable growth stage.”

The reserves, however, were going to rise above $12 billion within a week due to inflow of US$2.4 billion from China, the minister said.

Miftah said in order to streamline the economy, the coalition government had to take tough decisions to save the country from default. With the difficult decision of raising the petroleum prices by Rs 60 per liter, “We have managed to avert an imminent default. Now we will move towards the stability stage and then towards the sustainable growth stage.”

Courtesy Bol News

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