The new Federal Minister for Finance and Revenue, Shaukat Tarin has said that the government of Pakistan is trying to renegotiate the terms of the International Monetary Fund (IMF) programme.
Tarin said this during the National Assembly Finance and Revenue meeting on Monday. He said he is trying to convince IMF that price hikes in electricity tariffs will only create problems for the people, as the country is already deeply impacted by the COVID-19 pandemic.
“We have assured IMF of reducing circular debt but the demand of increasing tariff is not understandable,” he said.
Tarin further added that the terms and conditions can also be fulfilled if the government “curtails circular debt through other means instead of increasing the tariff.”
“Financial and monetary wallets are open all over the world but the IMF’s sword is only hanging over us,” Tarin maintained.
In addition, the State-Owned Enterprises (SOEs) cannot be managed by the government, and they must be privatised.
“The 17 per cent General Sales Tax (GST) rate is very high, and a mechanism has been prepared for its reduction,” he said.
On stabilising Pakistan’s economy, the finance minister said that the four to five per cent economic growth is enough for Pakistan, and the government will now focus on achieving the above-stated targets.
He regretted that the government is spending 85 per cent revenue on only nine cities and rarely invests in education and health.
Unless the country moved to higher economic growth, nothing would improve, and if we continue with stabilisation that has been in place for over two years, neither revenue collection would go up, nor job opportunities would be available to people, he explained.
He said the government would increase the Public Sector Development Programme (PSDP) in the next budget and provide equal growth opportunities to all provinces.
As the country lacks proper planning, Tarin said that he had selected 10 to 12 sectors on which economic experts had already started working so that they could come up with long-term planning for areas such as price stability, agriculture, industry, revenue, housing, social protection, national services, debt management and privatisation of loss-making state-run entities.
The committee chairman assured the finance minister of all cooperation by committee members.