ISLAMABAD, Jan 16: The government has identified four major drivers of growth — agriculture, small and medium enterprises (SMEs), oil and gas sector and information technology — to accelerate the pace of economic growth.

Public Sector Development Programme (PSDP) has been designed to support these drivers of growth, while meeting human development and poverty reduction targets, official sources said.

As the economic growth can only be achieved through enhancement in productivity and technological improvements that make the economy competitive in the global economy, the sources said, the strategy has a two-pronged approach.

The strategy focuses, firstly, on increasing economic growth in the shortest period of time and secondly to provide maximum attention to fighting poverty and improving human development by increasing the surpluses available for this purpose.

It is now recognized that “we must aim to achieve a minimum economic growth rate of 5-6 per cent to be able to fund up-scaled poverty reduction programmes” that will have lasting impact on poverty and provide fruits of development to larger segments of the society, the sources remarked

However, they say reliance on achieving high economic growth rests with the private sector and more important is the need to create institutions that nurture private sector to maturity.

Economic development, with private sector at the centre stage, must be built on seven pillars to achieve a competitive private sector that can play the role it is entrusted with taking advantage of knowledge and technology.

According to the sources, economic growth is going to remain largely private sector driven, with government acting as a facilitator, which is relied upon to increase investment and raise productivity.

The open market economy paradigm rests on the assumption that good entrepreneurs will produce good decisions and promote efficiency and competitiveness.

The need to attract back good entrepreneurs from overseas and prevent their excess outflow requires providing better investment environment and reduced cost of doing business.

The government, in this respect, has moved from the SRO culture to transparent policies laying down the rules of the game and providing a level playing field for entrepreneurs.

Corporate sector and stock exchange reforms have now placed Pakistan close to international standards.

Development of the capital markets is preparing Pakistan for better environment for direct foreign investment, investments from overseas Pakistanis and the local investors.

However, the sources viewed that good entrepreneurship and corporate sector and capital market reforms will need to be nurtured further to promote economic growth and development.

Banking reforms designed to widen the base of businesses and individual households, with access to credit, at reasonable rates and low transaction costs is the main theme of banking reforms.

Financial sector health has improved considerably in the last three years and the private sector banks are also entering the micro-finance market, after laws governing such MFIs were enacted and a start was made with ‘Khushhali Bank’ in the public sector, the source added.—APP