Islamabad, April 26, 2014 (PPI-OT): A meeting of Economic Advisory Council (EAC) was held at the Finance Ministry today with Finance Minister Senator Mohammad Ishaq Dar in the chair. The meeting lasted for six and a half hours and candidly discussed all aspects of the national economy.
Finance Minister welcomed the members of the Economic Advisory Council and expressed the hope that the meeting will enable the forum to provide an opportunity to interact and exchange ideas with prominent professionals associated with the economic development issues of Pakistan. The Finance Minister invited the five sub-groups of the EAC to make their presentations for discussion.
The sub-group on energy, headed by Mr. Farooq Rahmatullah, presented its proposals related to oil and gas sector with an aim to achieve lower cost of energy and to become self sufficient in our needs. The proposals included building strategic reserves of POL products, deregulating oil marketing and distribution, bringing price parity between competing fuels, enhancing exploration of oil and natural gas, encouraging exploration companies investment and prioritizing natural gas distribution to power generation and industry sector.
The sub group recommended a holistic privatization plan for DISCOS and bringing down the government subsidy in energy sector. Sub-group on industry and trade, headed by Mr. A. Razak Dawood, recommended diversification of export base; moving away from prime focus on textile and rice and for promoting non-agriculture based export industry including engineering, IT, chemicals and food processing.
The sub-group highlighted that GSP plus status is not just for textile and it includes all products. It recommended making Pakistan hub of exports from engineering and chemical sectors. The sub-group appreciated the strategy of phasing out SRO regime and protection while maintaining a level playing field.
Sub-group on food security/agriculture, headed by Dr. Abid Qayuim Suleri, presented a detailed briefing on state of food security in the country and recommended establishment of a special task force on social safety nets which should give recommendations to integrate and reform the existing social safety nets to enhance their collective impact.
It recommended school feed programme, special nutrition programmes, stimulus programme to expand farm outputs and market access, storage of essential food items, oil crop cultivation, cheap credit to agricultural sector and rationalizing market prices of essential food commodities. The sub-group appreciated the fiscal measures taken by the ECC for bringing down the prices of potato in the market.
The sub group on resource mobilization and expenditure management, Mr. Arshad Zuberi, gave a detailed presentation on resource generation and transparency, allocation and management of expenditure. It was decided that the sub group will present short and medium term measures which could be incorporated in the next budget and in a period of three years respectively.
The sub-group on social sector, Dr. Sania Nishtar, proposed recommendations on education, health and social protection sectors for incorporation in the next budget and for medium term reforms. The sub-group observed that after 18th Amendment and devolution of subjects to the provinces, there are areas in which the Federal Government can take initiative for the public benefit.
The Finance Minister said social safety net is an area which is priority area of the government and in this regard, he mentioned, that the government has increased disbursement to BISP from Rs.40 billion to Rs.75 billion in last budget.
He said that within the constitutional and legal mandate of the Federal Government, the recommendations which are doable will be included in the next Federal Budget. The Finance Minister said that we have introduced certain reforms in the taxation system during the last budget and an incremental approach has been adopted with a plan to implement essential reforms in three years.
The Finance Minister also briefed the EAC on the performance of the government in the last nine months and shared the economic indicators. The EAC congratulated the Finance Minister on successful holding of Spectrum Auction and observed that it will have a far reaching impact on the development of social sector in the country.
The launching of Eurobond worth US $ 2 billion was also appreciated by the EAC. There was a general feeling that economy has taken positive turn and if the reforms and restructuring plans are implemented, there will be a turnaround of the economy.
Dr. Ishrat Hussain, Convener of the EAC, while winding up the discussion said that today’s meeting was very informative and productive. He said that the conveners of the each sub-group should solidify their recommendations meant for the next budget and submit to the IERU of the Finance Division by first week of May, 2014 and medium term recommendations will be discussed after budget.
It was decided that the next meeting of EAC will take place in the second week of May, 2014 to discuss the final recommendations of the sub-groups. Minister for Petroleum and Natural Resources, Mr. Shahid Khaqan Abbasi, Federal Secretaries, Members of the Economic Advisory Council and senior officials of the Finance Ministry attended the meeting.
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