Conditions will have to be accepted: Ahsan Iqbal

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ISLAMABAD: Federal Minister for Planning and Development Ahsan Iqbal on Thursday said that there would be no free lunch and conditions would have to be accepted to get foreign loans in the wake of severe resource constraints.

 

Without naming any international financial institutions (IFIs), including the IMF, the minister said due to severe resource constraints as a result of the lowest tax-to-GDP ratio in the region, there would be no option but to accept the conditions because there would be no free lunch.

 

“There will be a balanced walk between tough decision and political stability as the government has been taking tough decisions knowingly to steer the economy out of the crisis mode and move towards growth and prosperity,” Ahsan Iqbal said while talking to reporters after the eighth Citi-PPAF Micro-entrepreneurship Awards ceremony here.

 

To a query about the controversy over the poverty figures, the minister said the figures calculated by the previous regimes were controversial because the role of the Planning Commission was completely undermined and ignored. “Now the PML-N-led government will convert it into a think tank,” he added.

 

The government, he said, would have to take ‘tough decisions’ in the first two years of its tenure as it did in this budget 2013-14 but then the stage would be set to share dividends with the masses in the preceding three years.

 

The minister said the first priority of the government was to resolve the energy crisis and reminded that no work was done in the last 14 years in this regard and now the government wanted to shift its power generation from expensive oil-based production to coal and gas in order to reduce its cost. He said that 14 years ago, the prices of oil stood at $20 per barrel which had now crossed $120 per barrel, so the people of Pakistan could not afford expensive energy.

 

Dwelling upon the issue of poverty, he said the economic crisis had forced two-thirds of the population into poverty. “In accordance with the definition of $2 per day, almost two-thirds population is living below the poverty line,” he said.

 

“We are taking tough decisions to revive the economic growth,” the minister said, and cited an example that any patient has to swallow bitter pills in order to improve his health. “The government did not increase the salaries of public sector employees by 50 percent in the budget because we did not want to use the official printing press to print money which could result in price hike.”

 

He said that when they had left power 14 years ago, the tax-to-GDP ratio stood at 13.5 percent but now it had gone down to below nine percent of the GDP. In the developing countries, this ratio stood in the range of 15-20 percent.




Courtesy:  The News


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