Finance Minister of Pakistan Muhammad Aurangzeb presented economic survey of Pakistan 2023-24 on Tuesday.
Pre-budget document called the “economic survey” provides information on socio-economic metrics for the previous fiscal year.
The finance minister began his news conference by stating that the Pakistani rupee had devalued by 29% and that the foreign exchange reserves had dropped to two weeks’ worth of import cover in the fiscal year 2022–2023.
According to the finance minister, the nation began implementing changes under Prime Minister Shehbaz’s direction.
Before becoming the finance minister, I worked in the private sector, but even then, I understood that Pakistan had to turn to the IMF because we had no other choice; this is why the IMF is known as the lender of last resort, he said.
“If Godforbids, we were not working in the IMF, we might have not been discussing objectives here and in a very difficult position.”
The minister stated that the effects of the energy equation and interest rate regime were impeding the expansion of larger-scale industry, and that agriculture was the “savior” owing to the bumper crops.
According to Aurangzeb, agriculture will continue to be a major driver of growth in the future.
Regarding the budget, a 30% increase in revenue collection was seen, nearly “precedented” from our initial starting point. The finance minister expressed gratitude to the provinces for using their primary surpluses.
“Without the provinces’ delivery, we would not have been able to fulfill our commitments to the IMF under the terms of the nine-month SBA.”
He stated that the provinces had to be commended appropriately for keeping their word.
According to Aurangzeb, the nation had a current account surplus during the first three months of 2024. “While I don’t know the exact figure, I’m very certain that we will have a surplus in another month based on the $3.2 billion in remittances for the month of May.
So, my prediction that the current account deficit would be less than $1 billion by the time we enter government came true.”
He continued by praising the succeeding administrations for the recent period of rather stable economic conditions. “First, the caretaker administration banned smuggling, instituted administrative procedures, and [started a crackdown] against hundi hawala.
“The State Bank of Pakistan then proceeded to concentrate on the structural component. Exchange businesses that engaged in speculating were gradually phased out, and capital requirements were raised.”
Regarding the recent bailout package discussions with the IMF, the finance minister reported having a constructive conversation with the international lender.
The finance minister restated that no public firm is strategic while highlighting the necessity of raising the tax to GDP ratio.
Whether the policies deal with taxes or power bills, he demanded that they be put into effect. “There is no sacred cow, everybody is entitled to play its role.”
The minister of finance stated that the nation cannot function using charitable giving, emphasizing the necessity of raising tax revenue.
He claimed that the country’s losses from power theft are estimated to be about Rs 500 billion and that power distribution corporations are not allowed to operate in the public sector.