Economy picking up as deficits curtailed; taxes, exports, stocks go up: Hammad

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Staff Reporter

Islamabad

Federal Minister of Economic Affairs Muhamamd Hammad Azhar Tuesday said the incumbent government not only uplifted the ailing economy but also virtually put it on growth path as clearly indicated by various economic indicators.
Addressing a press conference here, he said now, the economy had started picking up as economic indicators including investment inflows, foreign exchange reserves, revenue collection, current account balance, trade balance, ease of doing business, Public Sector Development Programme spending, Stock Exchange performance and inflation were showing positive developments.
Giving break-up of performance of various economic indicators, he said the current account deficit in dollar terms came down by 64% during the first quarter of current fiscal year compared to the reduction of 32% during the corresponding period of last year.
The fiscal deficit reduced by 1.4% in first quarter of financial year 2019-20, whereas it witnessed about 0.4% reduction on year-on-year basis, adding primary budget in first three months was in surplus by Rs285 billion.
Meanwhile, foreign portfolio investment, which was flowing out for last three years, grew by $350 million, showing growth of 137 percent.
Hammad Azhar said foreign exchange reserves, which were constantly reducing by $500 million per month since 2017, however, it was stabilized since January 2019 despite the fact that the government had made record debt payments to debt servicing amounting to around $10 billion.
On revenue front, he said number of tax filers increased by 55% as the domestic revenues had increased by 25 percent during the four months, adding there had been growth of 15 percent in overall revenues despite the fact that imports into the country were on decreasing trend.
He said the government had achieved 90 percent revenue collection target set for the first quarter by collecting Rs960 billion taxes.
The minister said circular debt, which had mounted to Rs1,200 billion from Rs450 billion, mainly during the previous government’s last couple of months, were now mounting only by Rs12 billion per month compared to Rs38 billion, per month, adding the piling up of circular debt would be reduced to zero by December 2020.
He said the country had also made significant improvement in ease of doing business by climbing down the index by 28 points, adding steps were taken to further improve the doing business score.
He said the stock market in the country grew by 6,500 since the government took over while the PSX index surged by 1,500 points in last three days, which he said was another sign of economic recovery and development.
About exports, he said garment exports grew by 36%, rice by 52%, and foot wear by 54% respectively during the first quarter.
He said measures were also taken to check inflation, which he said witnessed some increase due to currency value management.
However, he clarified that the inflation during the first 13 months of current of the PTI government was still low at average of eight percent compared to the previous government of PPP and PML-N, during which it was witnessed 21.5 percent and 8.4 percent respectively.
He said some food commodities had registered increase in their prices that was due to seasonal effects and it would stabilized soon.
He said federal government in close coordination with the provincial governments was making a comprehensive mechanism to control the prices with effective monitoring and ensuring fixed prices.