ISLAMABAD: Advisor to the Prime Minister on Finance Shaukat Tarin said on Sunday that after achieving successful completion of the stabilisation agenda by reducing current and fiscal account deficits by 3.3 percentage points and 3.2 percentage points of the GDP in one year, the economy needs to transit from stabilisation to sustainable,equitable and job creating growth with human face.
The current budget 2009-10 will focus on productive sectors of the economy -agriculture and manufacturing, enhancing productivity level through improvements to human capital base and physical infrastructure and ensure availability of cost effective energy in the country, he said while addressing a crowded press conference here at “P”block auditorium this morning.
He was flanked by Minister of State for Finance Hina Rabbani Khar and other senior official of the Ministry of Finance and other officials.
Shaukat Tarin said that during the 2008-9 the response of this government was phasing out of the subsidies and staining budgetary the resources.
He said that the expenditures were rationalised through a process of prioritisation of government development schemes to reduce budget deficit.
He said in this regard development expenditures were reduced and went down by Rs.120 billion adding said that SBP followed a tight monetary policy to reduce the aggregate demand and bring down inflation.
There were adjustments in the petroleum prices and electricity prices to reduce burden on the budget, he remarked.
He said that there was also net borrowing from the Budgetary support from SBP as October Rs.252 billion to Rs.258 billion by March it had been reduced to Rs.58 billion which means we have started paying back to the SBP rather taking back from them.
He further said that imports of non-essential items were curtailed by tariff adjustments to reduce the trade and current account deficits.
He said that the government was very transparent in highlighting figures in the Economic Survey 2008-08.
He said that in the survey the government said that economy has slowed down and all these have affected the economic growth.
However, he said that said that the economy has displayed the visible signs of stabilization as the government‘s first target was the stabilization of the economy.
Shaukat Tarin said that Fiscal deficit has remained on target which means it has come down from 7.6 percent in 2007-08 to 4.3 percent in 2008-09.
He added that a reduction of a reduction of 3.3 percent in one year.
He said that current account deficit has been reduced from 8.5 percent to 5.3 percent of GDP again a reduction of 3.2 percent in one year.
Advisor to the Prime Minister on Finance and Economic Affairs Shaukat Tarin said that the key objectives set for the Budget 2009-2010 after achieving successful completion of stabilization agenda by reducing current and fiscal account deficits by 3.3 percentage points and 3.2 percentage points of GDP in one year.
He said that the economy needs to transit from stabilization to a sustainable, equitable and job-creating growth with human face which will entail:
Focus on productive sectors of the economy- agriculture and manufacturing, Enhancing productivity level through improvements to human capital base and physical infrastructure and ensuring availability of cost-effective energy The Budget, he said will focus on reinvigorating economic growth.
“Our tax and duty measures in Budget for Fiscal Year 2009-10 would revolve around the following concepts:-
1. Provide protection to the poor and vulnerable against the current economic downturn by providing cash transfers and skill development;
2. Revive manufacturing and industry, especially export-oriented industry to raise their productive levels;
3. Broaden the tax base instead of overburdening the existing taxpayers; and restrain unnecessary imports to improve the Balance of Payment position.
Highlighting the salient Features of the Federal Budget 2009-10, he said the Budget 2009-10 has the following main salient features:
a) The total outlay of budget 2009-10 is Rs. 2482 billion. This size is 23.5% higher than the size of budget estimates 2008-09
b) The resource availability is estimated at Rs 2318 billion against budget estimates of Rs. 1836 billion in 2008-09.
c) Net revenue receipts for 2009-10 have been estimated at Rs.
1372 billion indicating an increase of 23.5% over the budget estimates of 2008-09.
d) The provincial share in federal revenue receipts is estimated at Rs. 655 billion during 2009-10 which is 15.3% higher than the budget estimates for 2008-09.
e) The capital receipts (net) are estimated at Rs. 191 billion against the budget estimates of Rs. 221 billion in 2008-09.
f) The external receipts in 2009-10 are estimated at Rs. 510 billion. This shows an increase of 70% over the budget estimates for 2008-09.
g) The overall expenditure is estimated at Rs. 2482 billion of which the current expenditure is Rs. 1699 billion and development expenditure at Rs. 803 billion.
Current expenditure shows an increase of 3.5% over the revised estimates of 2008-09, while development expenditure will increase by 68.1% in 2009-10 over the revised estimates of 2008-09.
h) The share of current expenditure in total budgetary outlay for 2009-10 is 68.5% as compared to 79% in revised estimates for 2008-09.
i) The expenditure on General Public Services (inclusive of debt servicing transfer payments and superannuation allowance) is estimated at Rs. 1189 billion which is 70% of the current expenditure.
j) The size of Public Sector Development Programme (PSDP) for 2009-10 is Rs 646 billion. While for Other Development Expenditure an amount of Rs. 157 billion has been allocated. The PSDP shows an increase of 54% over the revised estimates 2008-09.
k) The provinces have been allocated an amount of Rs. 200 billion for budget estimates 2009-10 in their PSDP.
I) An amount of Rs. 25 billion has been allocated to Earthquake Reconstruction and Rehabilitation Authority (ERRA) in the PSDP 2009-10.
Shaukat Tarin said the overall PSDP has been raised to Rs 646 billion, showing an increase of 54% as against the revised estimates 2008-09 at Rs. 419 billion.
Her added that Federal PSDP is estimated at Rs. 446 billion i.e. 66% higher than the revised estimates 2008-09 of Rs. 269 billion.
iii. The share of Federal Ministries/Divisions in the PSDP is Rs.
285 billion showing a raise of 96% over revised estimates 2008-09.
iv. The Corporations’ PSDP 2009-10 has been placed at Rs. 63 billion indicating an increase of 32% over revised estimates 2008-09.
v. Special Programme have been allocated a sum of Rs. 35 billion indicating an increase of 25% over revised estimates 2008-09.
vi. Earthquake Rehabilitation and Reconstruction Authority (ERRA) has been allocated Rs. 25 billion for budget estimates 2009-10. vii.An amount of Rs 38 billion has been provided in the budget 2009-10 for the development of Special Areas i.e. AJ&K N.A and FATA which is higher by 55.7% as compared with revised 2008-09. viii.The allocation for provincial programme is estimated at Rs 200 billion.
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