Inside Financial Markets

Dar urges political parties to unite for economic prosperity

ishaq darDar urges political parties to unite for economic prosperity

ISLAMABAD: Federal Finance Minister Ishaq Dar said the government has announced several measures in the budget 2013-14 to gear up economic activities and generate employment opportunities for the youth.

Winding up the debate on budgetary proposals in the National Assembly on Saturday, he said under the medium term plan we want to enhance the investment to twenty per cent ratio of GDP. This will create numerous opportunities for the skilled workers and youth.

The finance minister said we have enhanced the volume of annual development plan to Rs540 billion from Rs360 billion, which is a record fifty per cent increase.

The minister said the Benazir Income Support Programme will continue and its volume has been increased to seventy-five billion rupees from forty billion allocated previously. He said now the beneficiaries of the programme will get 1200 rupees per month. Regarding minimum wage, the finance minister announced to enhance the minimum wage to ten thousand rupees as was announced by Punjab and Khyber-Pakhtunkhwa provinces.

He said on the demand of the members, tax slabs have been rationalised to put minimum burden on low income groups. About the steps taken for the welfare of farmers, he said subsidy on fertilisers has been increased to Rs30 billion from Rs10 billion. He said arrangements have also been made to ensure import of fertilisers on time.

Referring to the upcoming visit of IMF delegation to Pakistan, the finance minister said the government will have to contact IMF and other financial institutions to retire the debt taken by the previous government. He said we will have to pay over three billion dollars debt during the next financial year.

Ishaq Dar reassured that the circular debt of over Rs500 billion will be cleared within sixty days, out of which RS326 billion will be retired before the 30th of this month. Regarding the demand to withdraw one per cent increase in GST, the minister said the country is passing through difficult economic situation and there is a need to put the country on the path of fiscal discipline and self-reliance. He made the commitment that GST rate will be reduced once the country’s resources allowed us to do so.

The finance minister said it has been decided to impose ten to fifteen per cent withholding tax on rental income in place of 17.5 per cent. He said the tax rebate for researchers, teachers and non- profitable institutions is being revised to 40 per cent from 75 per cent.

About tax on Hajj operators, he said it is not a new tax and we have only increased its rate to 3500 rupees from 2500 rupees. He clarified that this tax is not imposed on pilgrims but on the income of tour operators.

The minister said the zero rating is restored on milk and dairy products, stationary items and bicycles on the recommendations of the members. He said it has been decided to increase withholding tax to 15 per cent from 10 per cent on the users of cellular phone. The decision has been taken after consultation with the stakeholders, he added.

The minister said that payment of tuition fee for higher education was earlier extended to the students of interior Sindh and three divisions of South Punjab including Multan Bahawalpur and D.G Khan. Now this facility is being extended to Kohistan Malakand and Dera Ismail Khan, he added.

Dar said overseas Pakistanis are an asset and contributing greatly to the economy of the country. He said a comprehensive policy is being prepared to look after their interests. The finance minister pointed out that the economy is facing many problems and all the political parties will have to work together to find solutions to these problems. Welcoming recommendations of the members of both houses of the Parliament on the budget, he agreed with the members that priority should be given to the completion of ongoing development projects.

About 20 per cent recommendations of the members have been included in the Finance Bill, he added.


Sanie Khan

Sanie Khan holds a deep knowledge of the financial markets in Pakistan. Based in Karachi, he has over 20 years of hands-on management experience in financial technologies and managing operations in the financial sector. He was the General Manager at the Pakistan Stock Exchange (PSX) for 17 years. He along-with senior members of Exchange

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Inside Financial Markets was a joint publication of Pakistan Stock Exchange (PSX)and Society of Technical Analysts Pakistan (STAP)