The Ministry of Finance has said that the economic policies and economic reforms programme of the government being implemented with the support of IMF are based on sound and well-established principles of good economic management. “The objective of these policies is stabilization in the first phase, followed by rapid, sustainable and inclusive growth,” says the Finance Division in response to certain news reports insinuating that the “IMF policies [are] leading to destruction of economy”.
The Finance Division has maintained that the government’s policies have already started showing positive results. There is significant improvement in economic indicators.
The external sector has stabilized and the fiscal deficit has declined significantly in the first six months of the financial year. Low tax-to-GDP ratio is amongst the fundamental problems of Pakistan’s economy. Unless this is corrected, the country cannot achieve prosperity.
Therefore, a multi-pronged revenue mobilization strategy is being pursued to broaden the tax base and raise tax revenues in a balanced and equitable manner.
To cushion the low-income groups from any adverse effects of stabilization measures, the Government has allocated sufficient resources for income support and social protection programs and has increased spending on health and education.