Dar presents federal budget, sets GDP growth target of 5.7pc693 views
ISLAMABAD: Finance Minister Ishaq Dar on Friday unveiled the budget for the fiscal year 2016-17 (FY2017-17), with a total outlay of Rs4.42 trillion.
Outlining the economy’s performance in the past two years, Ishaq Dar said in the past two years progress went over 4pc and reached 4.7pc – the highest in 8 years.” “This would have been better if the cotton crop hadn’t suffered a fall in growth of 28pc.”
The finance minister said has government was announcing a special package for the agriculture sector.
The government has set another ambitious growth target of 5.7pc for fiscal 2016-17 and over the next three years, he said that 7% growth rate will be achieved.
Dar said tax collection has increased 7pc, a historic achievement. “We will reach our target of Rs3.96tr and we want to push the tax-to-GDP ratio to over 10pc next year.”
The minister announced a total PSDP allocation of Rs1.675tr for the fiscal year 2016-17, of which the Federal PSDP make up Rs800bn.
These funds, Dar said, which would be utilized for various ongoing and new development schemes.
He said that the federal government has allocated 79 billion for higher education in Pakistan, which was the highest allocation in the history of Pakistan.
For health sector, he said that the government will spend Rs22.40 billion.
Dar said that federal government would spend Rs100 billion for return and rehabilitation of temporarily displaced persons (TDPs).
Under the China Pakistan Economic Project, he said that USD 46 billion will be invested on Railways, roads and other infrastructure.
He said that Pakistan’s progress is linked with the development of Gwadar. “In the present budget, 78 billion have been allocated to Pakistan Railways. Off them, 14 billion will be spent to buy new engines and bogies.”
He said 800 coaches will be repaired by the Railways.
Under the Development Programme, he said government will spend Rs32 billion on new water resources. “Diamer Bhasha dam is crucial to Pakistan’s water needs. We are allocating 32 billion for Diamer Bhasha dam while 43 billion will be invested on Dasu Dam,” he said.
Many small dams are under construction in Sindh, Khyber Pakhtunkhwa and Balochistan and FATA, he said.
“We have launched several projects to improve energy sector and reduce power outages,” he said.
“Overall, we have allocated Rs380 billion for various energy projects,” he said, adding that investment would be made on coal, energy, wind and solar projects.
“We will add up to 10, 000 MW of electricity to the national grid by March 2018. This will end load-shedding,” he said.
He said that his government has allocated 188 billion for the construction of highways, bridges and flyover. Karachi-Lahore motorway remains the top priority of the government, he said.
Urea, DAP prices slashed
Dar said that the government has prepared a historic package to uplift agriculture sector.
The Urea price would be slashed from Rs1900 to Rs1400 while DAP price will be brought down to Rs2500 from Rs2800.
He said that Rs26 billion subsidy would be given on Urea and 10 billion on DAP. The subsidy, he said, will be equally paid by central and provincial governments.
“We have prepared a macro-economic framework for the next three years. Over the next three years, GDP growth rate will be set at 7 percent.”
By 2016-17, our development expenditure has been fixed at 800 billion, he said.
Benazir Income Support Program (BISP)
“Under the Income Support Program (BISP), we have increased our budget form 40 billion in 2013 to 115 billion by 2016-17,” he said, adding the program would help alleviate poverty in Pakistan.
He said that some 5.6 people would benefit from the income support program by 2017. The budget of Pakistan Bait ul Mall was also increased to 4 billion, he said .
Defence budget increased
The finance minister said that Rs860 billion would be allocated for defence with an increase of 11 percent. In the last budget, Rs776 billions were allocated to national defence.
Minimum wage goes up
He said that the minimum monthly wage was increased from Rs13000 to Rs140090 under the fiscal budget 2016-17.
The per capita income risen to 1561 dollars per head, while inflationwas down to 2.82 percent, lowest in ten years.
Withholding tax on foreign TV serials
The finance minister said that the government was imposing withholding tax on foreign TV serial on the recommendation of Pakistan Broadcasters Association (PBA). The move would help promote the local industry, he argued.
Salary, pension increased
Ishaq Dar announced an adhoc relief of 10 percent on running basic pay scale of federal government employees, besides merger of two earlier adhoc increases of 2013 and 2014 in the basic pay scales.
He further said that Rs1000 conveyance allownce would be given to disabled person on the recommendation of Leader of the Opposition Syed Khurshid Ahmed.
He urged opposition parties to sit with the government and sign a charter of economy to deal with the challenges facing Pakistan.