ISLAMABAD: The Finance Ministry said Pakistan’s fiscal deficit could outgo six percent if the country is not paid the expenditures sustained in the war on terror by the US on time.
Dr. Abdul Hafeez Shaikh, Adviser to Prime Minister on Finance, while chairing the meeting of Economic Advisory Council here, has said that the recommendations of the Economic Advisory Council (EAC) would be given due significance in the formulation of country’s economic policies.
The Council meeting was told that the potential receipt of Rs128 billion from the US was included in the budget under expenditures of war against terror; but, it received only Rs30 billion as yet.
The fifth tranche from International Monetary Fund (IMF) due in mid-April may be jeopardized now if the fiscal deficit soars.
Appreciating the role of EAC in providing valuable advice to the government, Dr. Hafeez Shaikh said that the forum consists of experienced persons from various fields of national economy whose opinion deserve due importance. He reaffirmed that the EAC would play a vital role in designing and implementing economic policies.
The EAC deliberated on the economy, fiscal operations and challenges to the economy. The members of EAC appreciated the government for appointing Dr. Hafeez Shaikh as Advisor to Prime Minister on Finance.
They extended their full support to the Advisor for managing the economic challenges currently faced by the country. The members of EAC provided a deep insight on economic issues and suggested policy options to improve the economic scenario. They highlighted the need for prioritizing the development goals, strengthening the social safety nets and improving governance framework. They stressed the need to improve the resource envelop to ensure fiscal sustainability.
The EAC showed concern on rising inflation, a higher fiscal deficit, pressure on money supply due to government borrowing and delays in external flows. Dr. Hafiz A. Pasha, the Convener of EAC, provided an overview of the functioning of EAC.
It was also decided that EAC would meet on a monthly basis and thematic sub-committees of EAC would be formed. Members of EAC stressed the need for monitoring implementation of reform and initiatives on a regular basis.
It may be noted that the EAC was constituted in May 2008, by the Prime Minister to provide independent advice to the government on the formulation of economic policies and reforms agenda. The EAC comprises the economic management team of the government, technocrats, economists and leading businessmen.
The Advisor and the EAC acknowledged the valuable contribution made by Mr. Shaukat Tarin, former Finance Minister in managing the economy in difficult times. Court that Law Minister was not cooperating in reopening of Swiss cases.
Source: http://www.geo.tv/Business.htm
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