LAHORE, June 9: Former federal minister for foreign affairs Shah Mahmood Qureshi said on Thursday the country was likely to miss all major budget targets in the forthcoming fiscal year as it had fixed “unrealistic and overambitious goals” for itself.
Speaking at a post-budget conference organised by the Pakistan Thinker Forum here, he said the Public Sector Development Programme (PSDP) was reduced by Rs100 billion last year, and next one would not be any different. The government, he said, had prepared the federal budget on the dictation of the International Monetary Fund and other international agencies. Economic managers had created many cushions in the federal budget for future IMF talks.
“The federal budget is based on assumptions. Economic managers, on the one hand, were claiming that the country had meager resources for the development, but on the other hand earmarked Rs730 billion for the development.” He asked the economic team to elaborate where the government would get the huge sums of money.
He also pointed out that figures in the budget revealed that rate of unemployment would further jump up during the next fiscal year, as the country required a minimum six per cent GDP growth to maintain the present level. Qureshi estimated that the country needed over seven per cent growth to address the unemployment issue. However, the budget projected growth at 4.5 per cent.
He said the country had persistent fiscal deficit of six per cent, which would swell further in the next financial year. The revenue collection would hardly touch Rs1.540 trillion during the next fiscal year, he said.
Speaking about the mounting inflation, he asserted that Pakistan had the highest food inflation of 18.4 per cent. Economic managers claimed that inflation was due to high oil prices in the international market, which was beyond the control of the government, but it was not true. “The oil inflation is the result of compound taxation as for government it is the easiest way to generate more revenue.”
He indicated that the average figures of last three years revealed that sugar prices had risen by 152 per cent, edibles oil and beef by 85 per cent, meat 87 per cent, rice 57 per cent and pulses by 122 per cent. Qureshi was of the view that the country had witnessed an agriculture growth of 1.9 per cent, which in per capita terms was negative. However, instead of giving relief to the agriculture sector the government had put an additional burden of Rs44 billion by imposing GST on agriculture inputs.
He said farm income tax was a buzz word, and he advocated that “all incomes should be taxed regardless of their source.”
Former minister Ijazul Haq termed bad governance the root cause of all economic ills. In Pakistan the government did not make budget, it was rather prepared by foreigners. He said on the one side all political leaders were talking about austerity measures while on the other side the government had increased budget allocations of Presidency and PM House. — Staff Reporter