Fiscal consolidation

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IRRESPECTIVE of the propaganda campaign being unleashed by its detractors, PML (N) government must be appreciated for taking tangible measures for economic and fiscal consolidation. It is because of these efforts that despite serious political crisis and attempts being made to paralyse working of the government, the World Bank has said that economic growth in Pakistan is forecast to increase to 5.5 per cent in the fiscal year 2017-18 and reach an average of 5.9 per cent over the medium term on the back of continued robust domestic consumption, rising investment and recovery in exports.
Global Economic Prospects report published by the Bank is acknowledgement of the prudent policies of the government and their impact on the overall economy. The country was doing well before the ouster of Mian Nawaz Sharif by the Supreme Court in Panama case that sent negative and dismaying signals to businessmen and entrepreneurs. Apart from this, there had also been continued efforts to generate one crisis after another in a bid to deny opportunity to Shahid Khaqan Abbasi government to run the country with peace of mind. However, Mr. Abbasi has succeeded in not only arresting the decline but also brightening prospects for accelerated growth, more investment and an increase in exports and revenue generation. The situation would definitely improve further if he succeeds in his plans to expand the tax net, cost of doing business is reduced to give boost to production and ensures uninterrupted electricity and gas to the industry in coming months. However, as cautioned by the Bank, there are challenges like political instability and uncertainty, rising debt repayment and additional expenditure required for holding general election. These may also force a reduction in developmental budget especially when the United States has stopped all types of aid and the country will have to spend more from its own resources to fight on-going war on terror.