09-07-2005, 12:16 AM
Today Pakistan economy is much better shape than it was ever before. Pakistan is poised to catch China in term of growth for the fiscal year of 2005-2006. in 2004-2005, Pakistan economy grew by 8.4%, which is one of the fastest in the region. Progress is taking place throughout society. Thanks to the widespread reform s introduces by the President, Perviz Musharaf. Foreign companies are investing billions of dollars to pursue the opportunities of a market of world sixth largest population. A change is evident throughout the society
ISLAMABAD (September 06 2005) The Asian Development Bank (ABD) President, Haruhiko Kuroda, on Monday advised the government of Pakistan (GoP) to do away with its policy of granting subsidies to agriculture and certain other sectors. He said that a subsidy-free culture would help Pakistan sustain its as high as 8 percent growth rate in the coming years.
Haruhiko Kuroda expressed these views in the meeting with Pakistan's economic team.
The ADB chief also asked Pakistan's economic managers to follow a policy of 'cautioned vigilance' to strict check on rising inflation.
He said that ADB would increase yearly funding from $900 million to $1.5 billion in 2006. He asked the ADB team to review the whole process of project development and disbursement to reduce the project cycle time.
Dr Salman Shah, Adviser to Prime Minister on Finance, Revenue, Economic Affairs and Statistics, led the official team in the meeting that briefed the ADB delegation on economic development and the strategy for the future.
Salman was assisted by Minister for Privatisation Dr Abdul Hafeez Sheikh, Finance State Minister Omar Ayub, Hina Rabbani Khar, Governor State Bank of Pakistan (SBP) Dr Ishrat Hussain, Economic Adviser Finance Division Dr Ashfaq Hasan Khan and Federal Secretaries of Ministries of Finance, Communications, Water and Power, Planning and Development.
Welcoming the ADB President and members of the delegation, Salman said that Pakistan's economic policies had started to pay good dividend to the people. Highlighting various initiatives and reforms introduced by the government to improve the financial sector, good governance, eradication of corruption Dr Shah said that when President Musharraf took over, Pakistan's economy was in a bad shape. Fiscal deficit was out of control; public debt ratio to GDP was over 100 percent; inflation was in double digits; and investors' confidence had shattered due to inconsistent policies. He said that then the economic team decided to go for major structural reforms.
He said the government introduced fiscal responsibility and debt limitation law for the first time in the history of Pakistan.
According to the Advisor, the law limits government borrowing and spending. He added that now all macro-economic indicators are moving in the positive direction and fiscal deficit has been brought down from 6-7 percent to 3.2 percent. Double-digit inflation has been reduced to single digit; lending interest rates have been reduced considerably; the GDP growth has picked up gradually, and last year it was 8.4 percent.
He said that FDI, which used to be around 350 million dollars a year, reached 1.4 billion dollars this year. Public debt came down to 62 percent of GDP from 100 percent. External debt-to-GDP ratio has also been brought down to 32 percent from 66 percent of GDP. Foreign exchange reserves increased considerably and Pakistan's credit rating improved.
The Advisor said that to sustain a higher growth rate a number of initiatives have been taken by the government for equitable development. He mentioned several programmes, which the government launched for economic development of the country, including Khushal Pakistan Programme (KPP). Community development initiative that provides utilities and services to the people at the grass-roots level has been intensified. He said that Khushal Pakistan Fund (KPF) has been established to provide rural development funding, and the Prime Minister's concept of 'one village one product' has been introduced with the help of ADB. Spending on primary and higher education has been substantially increased.
Regarding requirements of infrastructure, including roads, highways, logistics, mega city development projects, the Adviser asked the ADB to reduce time period for project development and disbursement of funds for projects.
The delegation was given detailed presentations on Pakistan's future requirement of water both for agriculture and drinking as well as power and roads and other development projects.
Dr Ishrat Hussain briefed the delegation about various financial sector reforms.
Dr Hafeez Sheikh informed the visiting team about transparency in privatisation programme of the government and involvement of people in the programmes through offering shares to general public. He said the privatisation proceeds were being used to reduce public debt of Pakistan.
Special Secretary Tanvir Ali Agha said that the government was planning to set up a small group to review and select priority projects for speedy implementation. He asked the ADB team to join this process.
ISLAMABAD (September 06 2005) The Asian Development Bank (ABD) President, Haruhiko Kuroda, on Monday advised the government of Pakistan (GoP) to do away with its policy of granting subsidies to agriculture and certain other sectors. He said that a subsidy-free culture would help Pakistan sustain its as high as 8 percent growth rate in the coming years.
Haruhiko Kuroda expressed these views in the meeting with Pakistan's economic team.
The ADB chief also asked Pakistan's economic managers to follow a policy of 'cautioned vigilance' to strict check on rising inflation.
He said that ADB would increase yearly funding from $900 million to $1.5 billion in 2006. He asked the ADB team to review the whole process of project development and disbursement to reduce the project cycle time.
Dr Salman Shah, Adviser to Prime Minister on Finance, Revenue, Economic Affairs and Statistics, led the official team in the meeting that briefed the ADB delegation on economic development and the strategy for the future.
Salman was assisted by Minister for Privatisation Dr Abdul Hafeez Sheikh, Finance State Minister Omar Ayub, Hina Rabbani Khar, Governor State Bank of Pakistan (SBP) Dr Ishrat Hussain, Economic Adviser Finance Division Dr Ashfaq Hasan Khan and Federal Secretaries of Ministries of Finance, Communications, Water and Power, Planning and Development.
Welcoming the ADB President and members of the delegation, Salman said that Pakistan's economic policies had started to pay good dividend to the people. Highlighting various initiatives and reforms introduced by the government to improve the financial sector, good governance, eradication of corruption Dr Shah said that when President Musharraf took over, Pakistan's economy was in a bad shape. Fiscal deficit was out of control; public debt ratio to GDP was over 100 percent; inflation was in double digits; and investors' confidence had shattered due to inconsistent policies. He said that then the economic team decided to go for major structural reforms.
He said the government introduced fiscal responsibility and debt limitation law for the first time in the history of Pakistan.
According to the Advisor, the law limits government borrowing and spending. He added that now all macro-economic indicators are moving in the positive direction and fiscal deficit has been brought down from 6-7 percent to 3.2 percent. Double-digit inflation has been reduced to single digit; lending interest rates have been reduced considerably; the GDP growth has picked up gradually, and last year it was 8.4 percent.
He said that FDI, which used to be around 350 million dollars a year, reached 1.4 billion dollars this year. Public debt came down to 62 percent of GDP from 100 percent. External debt-to-GDP ratio has also been brought down to 32 percent from 66 percent of GDP. Foreign exchange reserves increased considerably and Pakistan's credit rating improved.
The Advisor said that to sustain a higher growth rate a number of initiatives have been taken by the government for equitable development. He mentioned several programmes, which the government launched for economic development of the country, including Khushal Pakistan Programme (KPP). Community development initiative that provides utilities and services to the people at the grass-roots level has been intensified. He said that Khushal Pakistan Fund (KPF) has been established to provide rural development funding, and the Prime Minister's concept of 'one village one product' has been introduced with the help of ADB. Spending on primary and higher education has been substantially increased.
Regarding requirements of infrastructure, including roads, highways, logistics, mega city development projects, the Adviser asked the ADB to reduce time period for project development and disbursement of funds for projects.
The delegation was given detailed presentations on Pakistan's future requirement of water both for agriculture and drinking as well as power and roads and other development projects.
Dr Ishrat Hussain briefed the delegation about various financial sector reforms.
Dr Hafeez Sheikh informed the visiting team about transparency in privatisation programme of the government and involvement of people in the programmes through offering shares to general public. He said the privatisation proceeds were being used to reduce public debt of Pakistan.
Special Secretary Tanvir Ali Agha said that the government was planning to set up a small group to review and select priority projects for speedy implementation. He asked the ADB team to join this process.
