ISLAMABAD, April 24: The Economic Coordination Committee meeting on Thursday deliberated in details the economic ramifications of the Iraq war on the economy of Pakistan.
The meeting, chaired by Finance Minister Shaukat Aziz, noted that business environment in Pakistan continue to show resilience. Stock exchanges remained buoyant, exchange rate was stable, prices of consumer goods were stable and inflation was low.
The meeting reviewed stock of the essential items, including oil, fertilizer, wheat and sugar, and expressed satisfaction over their availability in abundance.
The Ministry of Commerce briefed the meeting that exports during nine month were $7.86 billion as compared to $6.53 billion in the corresponding period of last year, registering an increase of 20.4 per cent. Similarly, imports during the same period were around $9 billion as compared to $7.3 billion, an increase of over 22.8 per cent.
The SBP governor informed the meeting that for better management of foreign exchange reserves and their investment, the State Bank has engaged consultant of international repute. The SBP was also working on a blueprint to upgrade its skills, human resources and management conforming to international standards to prepare it for meeting diversified challenges of monitoring management.
Dr Ashfaq, economic adviser, informed the ECC that according to the WTO report, Pakistan was one of the three best performing developing economies of the world with exports increasing at the rate of 20 per cent.
On debt situation, he says the debt servicing which reached 66 per cent by the year 1999-2000 has been brought down to 46 per cent, fiscal deficit is expected to be reduced from 7 per cent of the last year to 4.6 per cent in the current financial year, the domestic debt has been slowed down to one per cent, declining trend in the development budget has been arrested and revenue collection have improved.
The CBR chairman informed the meeting that during the last nine months net revenue collection was around Rs310 billion, registering an increase of 15 per cent over the corresponding of last year.
The Ministry of Railways informed the meeting that to facilitate cost effective export of wheat, the railways would offer over 50pc discount from up-country to Karachi on transportation of wheat to be exported.
The ECC approved government guarantee to facilitate the KESC to secure short-term finance facility of Rs5,000 million from consortium of Pakistani banks at the SBP discount rate equivalent to 7.5pc per annum.
To evolve price mechanism and tap export potentials of primary commodities, the ECC constituted crop assessment committees under the chairmanship of secretary MINFAL. To encourage Pakistani exports, the meeting approved Pakistan’s participation in the Exposition of Global Harmony Expo 2005 being organized in Aichi, Japan.
For effective marketing of the insurance business in the UAE by the State Life Insurance Corporation of Pakistan, the ECC decided to increase its paid-up capital from Rs750 million to Rs900 million.—APP
