ISLAMABAD, Nov 18: Prime Minister Syed Yousuf Raza Gilani asked a panel of 18 economists on Tuesday to come up with its final report latest by mid-January for addressing structural weaknesses of the economy.

A special cabinet meeting has been convened on Wednesday to review an interim report and the current economic situation and for a briefing on the IMF package.

Headed by Dr Hafeez Pasha, the panel presented short-term measures for “Economic stabilisation with a human face” with preferences and recommendations to stabilise and strengthen the economy.

The prime minister told the panel to prepare a medium-term framework for sustainable growth.

He suggested that needs of the agriculture sector should get more focus in final recommendations.

“My government considers agriculture a leading sector of economic growth. We do not, however, underestimate the importance of other sectors,” Mr Gilani said.

Adviser to the Prime Minister Shaukat Tarin said the government had worked out a nine-point agenda for steering the country out of the current crisis. The policy aimed to stabilise macro-economic indicators, particularly to tame the inflation.

He said that a board would soon be constituted with representatives from the planning commission and civil society for smooth implementation of the policy.

Mr Tarin informed the prime minister the report had suggested a reduction in the defence expenditure and some officials had proposed a cut of Rs115 billion.

He said the panel had recommended a revenue mobilisation of Rs75 billion through additional taxes, including imposition of a broad-based regulatory duty on non-essential imports, capital gains tax on properties and agriculture income tax and withdrawal of income tax exemptions.

The panel also proposed to limit government borrowing from the central bank through a parliamentary resolution, increase in average return on national savings schemes and setting up an independent bureau of statistics. It has not suggested any reduction in social sector programmes.

Mr Gilani said the interim report would help the government to draw up an economic stabilisation plan.

He said that findings of the report had already helped the economic team in negotiating with donors and multilateral institutions.

“I am happy to see that the report reflects the concerns expressed by me in my earlier address to the panel,” he added.

The prime minister reiterated that the government was committed to restoring macro-economic stability and confidence of domestic and foreign investors.

“At the same time it is essential that any stabilisation programme that we adopt provides an adequate potential for the poor and vulnerable,” he said, adding that a human face of stabilisation was absolutely necessary for a sustainable economy.

“We are confident that in a reasonable period, we will be able to regain momentum of economic growth by keeping inflation on a lower side,” Mr Gilani said. Only after achieving that goal, he added, gains of growth would flow to the common man.

While giving assurance about capability of his government to carry out reforms, the prime minister said Pakistan had the capacity to manage external resources efficiently and effectively.

“Measures and mechanisms will be reinforced to ensure cost-effectiveness and high productivity of foreign-funded projects in a transparent manner,” he added.

Minister for Planning and Development Makhdoom Shahabuddin, Deputy Chairman of the Planning Commission Salman Farooqi and Minister of State for Finance Hina Rabbani Khar also attended the meeting.