Latest news with #URAANPakistan
Business Recorder
4 days ago
- Business
- Business Recorder
PIDE holds seminar: Country's macro-economic indicators show signs of improvement
ISLAMABAD: Economists at a seminar while highlighting key economic challenges of Pakistan have said that the country's macroeconomic indicators have shown signs of improvement, such as declining inflation which is below five percent and a recent upgradation of credit rating by S&P from CCC+ to B-. Speaking at an event organised by Pakistan Institute of Development Economics (PIDE) here on Friday, they, however, emphasised the need to transition from mere stabilisation to robust growth to benefit the common people. The event brought together senior officials from the Ministry of Planning, Development and Special Initiatives, researchers, and economists to engage in a rigorous policy discussion. Speaking on the occasion, Dr Haider Ali explained that the seminar aimed to deliberate on aligning short-term macroeconomic stabilisation efforts with long-term sustainable growth strategies under the URAAN Pakistan framework. URAAN Pakistan is a strategic initiative by the Planning Commission built on the '5Es': Exports, E-Pakistan (digitalization), Environment, Energy, and Equity. Dr Khurram Ejaz presented a comprehensive overview of the current economic context and proposed strategies to move towards a stable growth path under URAAN Pakistan. He noted that Pakistan's economy has faced a multitude of external and internal shocks, including post-pandemic disruptions, the Russia-Ukraine conflict, and the devastating 2022 floods. These factors pushed the country toward fiscal and balance-of-payment crises, culminating in the signing of an Extended Fund Facility (EFF) with the IMF in September 2024. The IMF programme emphasised restoring macroeconomic stability through fiscal tightening, monetary policy, and external sector stabilisation. While it succeeded in curbing inflation and modestly reviving growth estimated at 2.7 percent, it limited the fiscal space for development spending capped at 2.6 percent of GDP. Dr Ejaz contrasted this with the ambitious targets of URAAN Pakistan, which envisions 6 percent GDP growth by 2029 with significantly higher employment generation. He acknowledged a critical financing gap between what is possible under the IMF framework and what URAAN Pakistan aspires to achieve. He proposed following five initial strategies to bridge this gap: (i) repositioning Development Finance Institutions (DFIs) to fulfill their core mandate rather than investing in low-risk securities; (ii) migrating suitable PSDP projects to Public-Private Partnership (PPP) mode to crowd in private capital; (iii) issuing diaspora, green, and SDG-linked bonds to unlock innovative financing; (iv) devolving social sector expenditures to provinces in a phased manner, and (v) reducing losses from state-owned enterprises (SOEs) and monetising non-strategic public assets such as ports under a structured asset recycling programme. Dr Nasir Iqbal questioned the underlying assumption that low growth is due to limited PSDP spending and argued that productivity, export orientation, and youth engagement are more critical to sustained growth than merely increasing public investment. He recommended establishing village-level economic zones, leveraging idle public infrastructure, and simplifying business registration to boost local entrepreneurship. Dr Karim Khan emphasized that IMF programmes and growth are not inherently contradictory and that sustainable growth must be private sector-led. He urged leveraging CPEC Phase-II and capitalising on productive investment avenues. Dr Shujaat Farooq added that governance reform and performance-based budgeting are crucial. He highlighted a disconnect between planning and finance ministries and stressed the need to engage provinces, whose PSDPs now exceed the federal government's in size. Dr Muhammad Zeshan noted the inefficiencies within PSDP allocations and tariff structures that perpetuate rent-seeking and protect low-productivity sectors. He advocated enabling emerging industries such as halal meat exports, seafood, and IT, and preparing for the Fourth Industrial Revolution through digitization, cloud infrastructure, and robotics. Shaaf Najib questioned the long-term impact of PSDP spending, citing studies that showed limited sustainability. He called for improving PSDP efficiency, prioritizing completed projects, and redirecting funds toward sectors with higher fiscal multipliers. Dr Mehmood Khalid appreciated the absence of tax rhetoric in the presentation but criticised the lack of growth diagnostics and the absence of evidence from existing research. He emphasised grounding all strategies within the URAAN Pakistan 5Es and aligning projections with realistic economic modeling. Dr Iftikhar echoed these sentiments, warning against public investment that crowds out private sector liquidity and highlighting inconsistencies in SEZ policies, HEC funding, and NFC allocations. Copyright Business Recorder, 2025
Business Recorder
01-07-2025
- Business
- Business Recorder
Agenda of sustainable economic progress being implemented: Ahsan
LAHORE: Federal Minister for Planning, Development and Special Initiatives Ahsan Iqbal said on Monday the government is implementing an agenda of sustainable economic progress. 'The government is pursuing a goal of achieving taking economy of Pakistan to one trillion dollar by the year 2035,' Ahsan said, adding: 'Our development model is to transform economic development through exports.' While inaugurating a modern classroom at the Pakistan Administrative Staff College (PASC)/ National School of Public Policy (NSPP) here Monday, Ahsan presented a comprehensive roadmap for governance reforms and institutional performance improvement, emphasising the transition from a procedure-focused to a mission-driven bureaucracy. 'The country is facing a crucial moment requiring data-driven, technology-enabled and accountable governance,' he said, adding: 'We must build institutions that are policy-consistent and shielded from political volatility, ensure transparency in decision-making, foster agility to respond to changing demands and instil responsibility in the use of public resources.' Ahsan Iqbal outlined the government's long-term economic vision under the banner of 'URAAN Pakistan', which aims at making Pakistan a $1 trillion economy by 2035. He said the strategy is built on the five pillars of the 5Es: Exports, E-Pakistan, Environment, Energy & Infrastructure and Equity & Empowerment. The minister said steps are being taken to restore public confidence in good governance, by following the policy of making bureaucracy a stable, transparent, agile and responsible. He also urged the officers to play a leading role in enabling export-led growth, digitising government operations, building climate resilience, improving infrastructure delivery and ensuring inclusive development. He said the civil servants must play their vital role for Pakistan's transformation, adding that the system must be reformed to deliver better outcomes. He introduced the STAR model — Stable, Transparent, Agile and Responsible — as a governance framework to guide civil service transformation. He commended the role of civil servants to make the China-Pakistan Economic Corridor (CPEC) a success which showed the dedication of Pakistan's civil servants. He reminded the participants that public service is a responsibility and leadership in Islam is a duty, not a privilege. The minister encouraged the course participants to take part in the training with a spirit of service, creativity and commitment to the national development. Copyright Business Recorder, 2025
Business Recorder
20-06-2025
- Business
- Business Recorder
Budget FY26: balancing social sector priorities amid fiscal constraints
Pakistan's federal budget for FY2025-26 has come at a critical time. The country is going through a fragile phase of economic recovery; provisional GDP for FY stands at a recovering & stable rate of 2.68 percent, remittances are increasing, inflation rates have declined and primary surplus currently constitutes 3 percent of the GDP (March-July 2024-25). Economists and fiscal experts are now debating whether the determined budgetary outlay will help maintain this trajectory or not. However, with persistent structural challenges in the country, i.e., rising gender inequality and regional disparity, growing climate vulnerability and a youth bulge, one also needs to analyze the situation based on considerations for resilient growth and inclusive development, mandates that can only be achieved through equitable social sector investment. Will this fiscal outline help align national goals with SDGs as well as move forward the mandate of URAAN Pakistan with its 5Es framework? To have a quick overview, the budget has assumed a modest economic rebound for the fiscal year 2025-26, characterized by an economic growth rate of 4.2 percent but an inflation rate as high as 7.5 percent. Amidst the challenging environment of two IMF Programmes, the Extended Fund Facility (EFF) and Resilience and Sustainability Facility (RSF), the budget has somewhat prioritised fiscal consolidation and revenue-based targets; 18 percent taxation on imported solar panels, higher petroleum development levy (collection target of Rs 1.468 trillion) and FED revenue target of Rs 888 billion for FY 2025–26. The tension, however, has slightly been eased up by measures such as strategic relief for the salaried class (mainly lower to middle income tiers) and a 7 percent increase in pensions. The National Economic Council has established a budget of Rs 4224, out of which Rs 1000 billion has been issued for the Federal PSDP (60 percent focusing on large-scale infrastructural projects), and a handsome amount of Rs 2,869 billion for provincial ADPs. With reference to social sector development, this is the most relevant area of concern, particularly after the passage of the 18thamendment, that led to the devolving of areas such as health and education to provinces. Unfortunately, despite the continuous efforts to bring social development into the heart of our development agenda, the budgetary priorities have caused significant cuts in social sector allocations. In the health sector, while non-development expenditures have increased, development expenditures have reduced from Rs. 27 billion to Rs 14.3 billion (almost half). This caters to 21 ongoing and new initiatives for preventive care, treatment and disease control and modern infrastructure, medical education, extension of cancer hospital and critical care facility, and the largest share being attributed to a tertiary care facility completion in Islamabad. In Budget FY 2024-25, one billion was allocated to the Federal Social Health Insurance, Sehat Sahulat Programme, while there is no direct allocation mentioned in this year's budget. The sustainability of this programme has long been a challenge, particularly due to its overambitious expansion of population and treatment coverage. However, this programme still serves as a major relief for the poorest segments of our society and protects them from catastrophic health expenditures that can push families below poverty line. Higher Education Commission (HEC) has experienced a drop from Rs.61.1billion (158 development projects) to Rs 39.5 billion (170 HEC projects). The combined allocation for water sector and hydropower projects has also seen major slashing and mismanagement, despite the ongoing concerns over potential water blockages by India. These financial cuts not only compromise critical areas of human capital development, but also deepen socioeconomic crises such as illiteracy, limited access to education facilities, malnutrition and water scarcity and mismanagement for the most vulnerable groups of our society, i.e., adolescent girls, children and the youth. While stability and reform are integral for the country's economic future, one needs to question as to what price will the common citizens have to pay, in exchange for their compromised socioeconomic well-being, financial security and the basic right to life? Considering the evolving dynamics of the world, there have been some significant strides as well; climate tagging of subsidies for government officials, incorporation of the component of disability-friendly infrastructure in HEC initiatives, and alignment of youth skill development programmes (allocation of Rs 4.3 billion) with the mandate of URAAN Pakistan. Moreover, BISP (Social Protection) has seen financial allocations grow 21% than last year, a generous amount for the expansion of its flagship initiatives. However, despite these positive developments, persistent institutional flaws, fiscal pressure, and political interference continue to hinder progress in the social sector. In short, at a time when inclusive growth and creation of a resilient workforce should be national imperatives, merely focusing on infrastructural revamping and macroeconomic stability is not the right way forward. While the government has announced some remarkable interventions in critical areas of health, education and social protection, they are still unable to fully embrace the principles of inclusive, resilient and well-governed growth. To truly align our national goals with SDGs, the policy and institutional framework needs to be thoroughly analyzed to make sure that the social sector is not overlooked under fiscal constraints but rather seen as a core pillar of human capital development and hence, economic progress. Only by placing the vulnerable groups of society at the heart of our development agenda and policy can Pakistan move towards sustainable prosperity. Copyright Business Recorder, 2025
Business Recorder
16-06-2025
- Business
- Business Recorder
Punjab tags record Rs1240bn for ADP
LAHORE: The Punjab government has unveiled a record allocation of Rs. 1,240 billion for the Annual Development Program (ADP) for fiscal year 2025-26, reflecting a significant 47.3% increase from the Rs. 842 billion allocated in the previous year. According to the budget documents released on Monday, this marks the largest ADP in Punjab's history and underscores the government's focus on sustainable, inclusive, and forward-looking development. With a population of over 127.7 million, Punjab continues to drive Pakistan's economy, contributing more than 55% to the national GDP, nearly 60% of total exports, and about 68% of agricultural output. Amid growing urbanisation and rising pressure on infrastructure, energy, and environmental resources, the government has positioned this ADP as a strategic response to evolving challenges. Aligned with URAAN Pakistan, the 13th National Development Plan, and the Sustainable Development Goals (SDGs) 2030, the development program aims to promote equity, innovation, and climate resilience, particularly benefiting underserved regions like South Punjab. The ADP 2025-26 focuses on major public investments across key sectors. The education sector has been allocated Rs. 148 billion, up from Rs. 82 billion last year, while healthcare will receive Rs. 182 billion, compared to Rs. 165 billion previously. Agriculture has been earmarked Rs. 80 billion, with Rs. 145 billion set aside for urban development and Rs. 120 billion for roads. The transport sector will get Rs. 85 billion, local government and community development Rs. 142 billion, and irrigation Rs. 38 billion. Additionally, Rs. 38 billion has been allocated for planning and development, Rs. 15 billion for environment and climate change, Rs. 25 billion for forestry, wildlife and fisheries, and Rs. 28 billion for tourism and archaeology. Industries, commerce and investment, and skill development and entrepreneurship will each receive Rs. 12 billion, while Rs. 6 billion has been allocated for water supply and sanitation. Copyright Business Recorder, 2025
Business Recorder
12-06-2025
- Business
- Business Recorder
No package given to exporters under URAAN Pakistan: FCCI
FAISALABAD: Expressing his immediate reaction to the Finance Minister's presentation of the annual budget for 2025-26, President of the Faisalabad Chamber of Commerce and Industry President Rehan Naseem Bharara said that he was expecting that there would be a discussion on the reduction in electricity prices and markups in terms of revival of industries and production costs, but unfortunately this situation was not clarified. He said no package has been given to the exporters to increase exports to $60 billion under URAAN Pakistan. He appreciated the reduction in tax rates for the salaried class and the reduction in federal excise duty on the construction sector and said that 18% increase in the tax collection target has been proposed, but it was not stated how this would be possible. He said that apart from some restrictions on non-filers, no clear steps have been taken to abolish this system. He said that the government is trying to promote green energy but 18% general sales tax has been imposed on imported panels. He said that we had high expectations from the current budget, but perhaps it can be improved through future amendments. Regarding the construction sector, Rehan Naseem Bharara said that there is a shortage of 15 million houses in the country. We had suggested that a house worth 10 to 15 million rupees should be exempted from all types of taxes. He said that the government has taken a good step by abolishing federal excise duty on commercial property, but no extraordinary steps have been taken regarding agriculture and exports. He said that the weaving industry is currently doing well. He said that urgent steps will have to be taken to increase IT exports and develop the industrial sector. Copyright Business Recorder, 2025
