LAHORE, May 5: International Labour Organisation Policy Planning director Dr Rashid Amjad has proposed linking of wages to productivity for maintaining the momentum of economic growth.

Speaking at a pre-budget seminar organised by the Pakistan Workers Confederation here on Friday with Raja Amin Rathore in the chair, he said the economy of the country had improved during the past five years.

He said the national income would increase by six to seven per cent this year as a result. The macro-economic balance had been restored due to government policies and industrialists had taken advantage of new trade opportunities and increased exports.

He said there had been no increase in investment during the past five years, but the economic growth had been achieved owing to increase in productivity and improvement in skills of workers.

Important policy decisions, he said, would be required in the budget for maintaining the economic growth momentum. A seven to eight per cent increase in the national income was necessary along with steps for controlling the growing inflationary pressure.

New investment was required in sectors where it could create job opportunities because there was 3.5 million unemployed persons in the country and the number was growing by an average 250,000 to 300,000 every year. He said steps were needed to facilitate access of small and medium scale entrepreneurs to finance. They were experiencing difficulties in access to finance at present.

He said prices of essential commodities had increased because of the failure of the Monopoly Control Authority to perform its functions and promote competition in the market. Absence of a healthy investment climate and denial of a fair profit share to depositors by banks had encouraged speculative investment in the stock market.

Dr Amjad said a suitable increase was necessary in minimum wages in general and wages of agriculture labour in particular in view of inflation.