Finance Minister Ishaq Dar presented Rs4.395 trillion budget for financial year 2016-17 before the National Assembly on Friday.
In his budget speech in the parliament, the minister presented a review of government’s performance over the last three years during which he said the country achieved economic stability.
“Economic indicators reflect our performance,” Dar said. “I am thankful to Allah that we are given an opportunity to present budget for fourth time. Our each budget was better than the previous ones.”
“We have successfully managed to put Pakistan on the right track.” The finance minister told the House that the country’s GDP growth stood at 4.7 pc. “While on the path to economic prosperity, the government has managed to put inflation in check,” he added.
The federal government unveiled Rs800 billion development budget, an amount that is Rs100 billion higher than last year but still comes across as less given the huge financing requirements of about 866 projects including the pressing needs of the China Pakistan Economic Corridor (CPEC).
Economic growth in the past two years has increased by 4.7 per cent, hitting an eight-year high.
“This would have been better if the cotton crop hadn’t suffered a fall in growth of 28 per cent,” he said.
Rs 115 billion have been fixed for Benazir Income Support Programme. Rs 380 billion investment would be spent on energy projects. Rs 910 billion have been fixed for defence budget.
In three years there has been an increase of 3% in tax revenues.
The increase has come on the back of higher tax rates. Meanwhile, the tax net has fallen with the number of returns filers going below the 1-million mark.
Dar said that the government’s aim is to restrict the fiscal deficit at 4.3% of the GDP.
Market capitalisation has increased over the last four years, while the pending merger of all three stock exchanges was also settled.
The PSX is also going to be added to the MSCI Emerging Markets Index.
The federal budget deficit — excluding provincial surpluses — will be brought down to 4% by 2017, and 3.5% by 2018.
The minister further said that rate of inflation which was recorded at 2.82 per cent is the lowest in the past 10 years.
A total of Rs11.4 billion will be allocated to the telecom sector.
The total estimated size of federal expenditures is over Rs4.395 trillion, around 8% higher than last year’s budget. An increase of 10% has been announced for pensioners from FY 2016-17.
Imports stood at 32.7 billions dollars between July-April 2015-16 as compared to 33 billion dollars in the same period in 2012-13.
A 40 percent increase was recorded in imports of machinery which shows an increase in investment.
Appreciating services of Pakistani expatriats, he said Pakistan’s foreign remittances soared to 16 billion dollars during July-April 2015-16 as compared to 11.6 billion dollars during the same period in 2012-13.