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ISLAMABAD, Jan 24: Finance Minister Shaukat Aziz said on Thursday that the government has made significant allocations to poverty reducing sectors, where expenditures will rise from Rs119 billion, 3.4 per cent of gross domestic product, in 2001-02 to Rs230 billion, five per cent of GDP, in 2003-04.
Speaking at the Pakistan Human Development Forum (PHDF), he said the macro framework of the economy had been stabilized and there had been a steady increase in the GDP.
He said the balance of trade had improved as exports had surged and imports, except for petroleum products, had remained contained.
Foreign exchange reserves were at an all time high of nearly $5 billion, fiscal deficit had been brought down and money growth was steady, he said.
He said the government had undertaken broad-based reforms to expand the space for the private sector, reduce the role of the government, improve the pricing policy, deregulate the regulatory regime or to improve the functioning of the market in different fields.
He said poverty was a multidimensional concept encompassing economic, political and social needs. The poor in Pakistan are not merely deprived of financial resources but they also lack access to basic human needs, he said.
He said the institutions of governance tend to exclude the most vulnerable from the decision-making process. The less the stake the poor have in the organized society the more vulnerable they are to be exploited by forces undermining the peace of civil societies, he said.
He said poverty reduction was a formidable challenge for the government and that had been the focus in the formulation of Pakistan Poverty Reduction Strategy Paper (PRSP), whose interim version was finalized last November.
He said the government had instituted a system for quarterly tracking of poverty related expenditures.
He said the flow of quick disbursing concessional financing was essential to support the PRSP. The most convenient mode of funding for this purpose would be straight budgetary support, he said.
CLARE SHORT: UK secretary of state for international development, Clare Short, said, in her speech, that there was good progress regarding government’s commitment to a crackdown on corruption, responsible economic management, pro-poor policy and a transition to genuine democracy.
She said the transition to effective democracy and sustainable development in Pakistan was an enormous challenge.
She said now was the moment to break with the failed policies of the past, to build a new inclusive democracy and to drive through a far-reaching reform agenda to reduce poverty.
She said that the people of Pakistan had been seriously let down by corruption, poor economic management and bad governance.
She said the annual GDP growth in the 1990s averaged four per cent compared to 6.2 per cent in the 1980s and almost a third of Pakistanis live on less than $1 a day.
Between 1997 and 2000, per capita expenditure on health and education under the Social Action Programme declined by more than 10 per cent, public services declined and poor people suffered the most, she said.
She said people in poor rural areas and poor urban neighbourhoods had been largely failed by the public and the private sectors.
She said the UK government and other members of the international community were committed to supporting the process of reform.
Increased funding discussed: British Secretary of State for International Development Clare Short called on Finance Minister Shaukat Aziz on the sidelines of the Human Development Forum on Thursday and discussed the possibility of increased flow of funds to help Pakistan combat poverty.
They discussed the progress on the programmes on human development and other social sector fields.
Shaukat Aziz said Pakistan was encouraging private sector to participate in the development of Afghanistan. However, he said that Pakistani entrepreneurs would have to be competitive to create demands of their goods on the basis of international standards.
He said Pakistan was committed to participative human development, capacity building and improvement of skills to help promote pro-poor development projects in the rural areas and urban slums.
Ms Short proposed that Pakistan should evolve a strategy to monitor the international funded Social Action Programme to ensure appropriate utilization of funds.
The finance minister emphasized the need for public and private sector collaboration with community participation to increase literacy and health cover at a grassroots level.—APP
