Economic stability required political stability: PM Gilani. – Photo by APP

ISLAMABAD: Prime Minister Yousuf Raza Gilani said on Thursday that because of his government’s prudent policies, a number of economic targets had been achieved during the first six months of the current fiscal year.

Giving a policy statement in the National Assembly on the economic situation, the prime minister said that despite facing challenges of floods, rains and deteriorating law and order situation and world economic recession, the economic indicators improved and inflation had been reduced to a single digit.

Mr Gilani said economic stability required political stability and urged the media to play an important role in that regard.

He said that although the PPP-led government had inherited the poor economy condition from the previous regime, the reforms initiated by it had started showing results.

The government controlled borrowing that helped reduce inflation to a single digit (9.7 per cent) for the first time in the history of the country.

The prime minister said expenditures were under control with only 45 per cent utilisation. Fiscal deficit was reduced to 7.6 per cent from 9.4 per cent and inflation to 9.7 per cent last month from 25 per cent. Prices of essential items decreased in the open market.

Mr Gilani said the government provided a number of incentives to farmers that improved the food supply situation. It was made possible with the help of reduced budget deficit and borrowing from the State Bank of Pakistan.

The prime minister said with a stable balance of payments position, the government would repay $1.4 billion of IMF loan during the current financial year from budgetary resources, which showed the country’s economic strength.

With its focus on the vital energy sector, he said, the government had been following and implementing structural reforms in the power sector and the timely payment of tariff differential subsidy was also being ensured.

The government is going to resolve the issue of circular debt soon and in this respect settlement of around Rs163 billion will be done in a few days.

He said the government had added 3,334 MW of electricity to the national grid since 2008 as against his promise of adding 2,000 MW.

Around 5,000 MW of hydel electricity will be added to the national grid in three to four years.

Rejecting a perception of running after the world with a begging bowl, the prime minister assured the house that the government was following and implementing the economic policies in the perspective of Pakistan’s economic conditions.

“Rest assured that the economy is in safe hands,” Mr Gilani said, adding that the economic reforms agenda proposed by the government was not a short-term action but covered total institutional framework.

Because of prudent economic policies, measures in place and good economic indicators, the country’s economic prospects are stable and the government is putting the economy on a right track.

The prime minister expressed his belief that the country’s future was bright and prosperous and said: “We are showing to the world that reforms and economic discipline is our own requirement and not due to others’ dictation.”

He said: “We are capable of organising ourselves and are on the right path to secure our nation’s present and future.”—APP