ISLAMABAD, April 20: Pakistan has officially revised upward its future growth projections that now aim at achieving a formidable eight per cent GDP growth rate by 2007-08, says a senior government official.

"Earlier, we had projected 6.2 per cent GDP growth by 2007-8, but now our medium-term growth projections have been set at eight per cent as the country's major economic indications have over-performed," claimed economic adviser to the ministry of finance Dr Ashfaque Hasan Khan.

He told Dawn here on Tuesday that GDP growth was expected to be six per cent during the current financial year against the recently revised upward growth forecast of 5.8 per cent. The original target was 5.3 per cent.

However, Dr Khan agreed that achieving eight per cent growth rate would require substantial private sector investment. The private sector, he pointed out, would play a major role to help achieve eight per cent GDP growth target by 2007-08.

The budget for 2004-05, the adviser said, would be investment and growth oriented, for which the government was currently considering offering new incentives and concessions to the private sector.

He said the government had decided to spend enormous amount for the improvement of infrastructure, which would ultimately help the private sector invest more. The government, he said, would greatly facilitate the private sector by creating a "much-needed conducive environment for the investors".

He was asked why would the private sector heavily invest, specially when there were still a lot of constraints and criticism about the lack of consistency in policies.

"You must take into account that interest rates are falling, there is stable exchange rate and the government is making huge investment to improve roads, highways and other facilities and these are our plus points that will attract the private sector investment," he replied. Issues concerning duplicity of taxes, he promised, would be taken care of in the next budget to adequately help the investors.

Responding to a question, he said the Public Sector Development Programme (PSDP) was likely to be increased from the present Rs160 billion to Rs200 billion in 2004-05. At the same time, Dr Khan who is also director general of the Debt Coordination Office, said that there would be further sizable expansion in the private sector credit.

This private sector credit, the economic adviser pointed out, had increased to Rs239 billion by April 3, 2004 compared to Rs89.6 billion of comparable period last year. "There has been a three-time credit expansion that will certainly yield good results."

In reply to another question, Dr Khan who held senior level policy discussions with the visiting IMF review mission, said that Fund officials had appreciated the meeting of performance criteria by the government. "There is no major issue that has been raised by the review mission," he claimed.