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Interior Minister Senator A. Rehman Malik and Federal Minister for Finance Dr. Hafeez Sheikh co-chairing first session of Pakistan Development Forum (PDF) at a local hotel on Sunday. – Photo by APP

ISLAMABAD: As federal and provincial economic teams assured the international community on Sunday of their resolve to introduce wide-ranging taxation measures, including Reformed General Sales Tax (RGST) and taxes on agriculture and real estate, Interior Minister Rahman Malik made a plea for waiving the $50 billion foreign debt to help Pakistan move ahead with the war against terrorism.

On the other hand, representatives of the international community attending a two-day Pakistan Development Forum asked the government and people of Pakistan to take the lead in reconstruction and rehabilitation of flood-hit areas.

Most of the foreign delegates repeatedly asked the authorities about steps they were taking to mobilise resources.

Two provinces – Sindh and Punjab – informed the meeting that despite facing opposition they were moving ahead on the RGST and planned to raise substantial resources through tax on agriculture and property.

Interior Minister Rahman Malik said that Pakistan was fighting terrorism as a frontline state and deserved that its $50 billion foreign debt was written off.

He said that besides the challenge of terrorism the country was also engaged in reconstruction and rehabilitation of flood-hit people.

He said that around 40,000 to 50,000 people crossed the Pak-Afghan border daily, but all of them were not Taliban. They also included drug smugglers and criminals and hence Pakistan wanted the Afghan government to install biometric checkpoints to stop illegal cross-border movement.

He said Pakistan had been fighting terrorism for almost 30 years and had broken the back of terrorists along its western borders. The fight would go on with or without the international community’s help.

At the conclusion of the first day’s PDF proceedings, US Special Envoy Richard Halbrooke said his government faced immense pressure at home because of high fiscal deficit, but it still wanted to contribute to reconstruction and rehabilitation efforts in Pakistan. The lead, however, must be taken by the people of Pakistan because he would have to explain to the new Congress why Pakistan was so important for the international community.

Punjab Chief Minister Shahbaz Sharif was conspicuous by his absence.

Punjab’s Senior Minister Sardar Zulfiqar Khosa said floods had caused $3.2 billion losses in his province.

Mr Khosa said Punjab needed $900 million to set up model villages and his government was improving the system of taxing agricultural income and property tax. “Sindh believes in self-reliance and it is going to impose flood surcharge on agriculture crops and residential and commercial plots in urban areas,” said Sindh Chief Minister Qaim Ali Shah.

Adviser to Sindh Chief Minister Kaiser Bengali said that progress had been made on the RGST and the provincial government would impose a flood tax for which a law would soon be tabled in the provincial assembly despite some opposition.

Khyber Pakhtunkhwa Governor Owais Ghani said his province needed Rs107 billion over the next 18 months for reconstruction in social sector and infrastructure development.

Chief Minister Amir Haider Khan Hoti said the provincial government had suspended new development projects of Rs18 billion from a development plan of Rs69 billion.

Dr Abdul Hafeez Shaikh said that talks had just started with presentations by provincial and regional governments and the federal government would brief PDF participants on Monday on the impact of floods on national economy and ways of dealing with consequences of the devastation.