ISLAMABAD – Finance Minister Muhammad Aurangzeb has stated that there is nothing secret in the loan agreement with the IMF.
He mentioned that no country is willing to roll over deposits or loans, but countries like China and Saudi Arabia are interested in investing.
While speaking at the Literature Festival in Islamabad, the Federal Finance Minister Muhammad Aurangzeb said that the currency has stabilized, and foreign exchange reserves have also gained stability.
By March to June, reserves will be equivalent to three months of imports. Inflation in the country has reduced, and its benefits should reach the common man.
He further mentioned that while global chicken prices have dropped by 14%, Pakistan has seen a 15% increase.
The government has repaid a $1 billion loan, and despite this, foreign exchange reserves are still stable. He reiterated that there is nothing hidden in the loan agreement with the IMF.
The minister highlighted that the tax-to-GDP ratio of 9-10% is unsustainable, emphasizing the need for tax reforms and structural changes. He noted the importance of restoring the credibility and trust in the FBR as an institution.
Focusing on end-to-end digitization, he said even he cannot file tax returns without an advisor, demonstrating the need for advancements in digitalization to prevent leakages and corruption in refunds.
Aurangzeb urged the business community to avoid speed money. In his speech at the Literature Festival, he added that a country cannot rely on donations alone; the private sector needs to step up to drive the country forward.
He also noted that no one is willing to provide rollovers or deposits now, but efforts are being made to attract investments from friendly countries like China, Saudi Arabia, and the UAE.
The first phase of CPEC was focused on infrastructure, while the second phase will be business-to-business.
He further remarked that the Prime Minister has a clear vision for direct foreign investment, and all future activities will occur at the B2B level.
The government’s role is not to conduct business; thus, the private sector should take the lead.
Privatizing PIA is not easy; otherwise, it would have happened ten years ago.
Aurangzeb mentioned various methods of privatizing state-owned enterprises, such as outsourcing and public-private partnerships.
He also shared that next year, there are plans to issue Euro bonds and discussions are ongoing for Panda bonds.
Pakistan’s population growth rate stands at 2.55%, and he expressed concern that with a population of 240 million, the country is already facing challenges. If it reaches 400-450 million, the situation will be even more challenging.
He emphasized the need for reforms in tax, energy, and state-owned enterprises, saying that while charitable work has its place, taxes are essential for long-term national development.
Energy costs are coming down to sustainable levels, but further structural reforms are necessary.
State-owned enterprises (SOEs) need reform and privatization, allowing the private sector to take the lead and reduce reliance on the government, thereby ensuring an efficient system.
