Pakistan Economic Survey depicts negative growth, revenue shortfall
Hafeez Shaikh blames coronavirus for everything
Adviser to the PM on Finance Abdul Hafeez Shaikh on Thursday said the coronavirus had badly hit the economy which was getting stable/stronger and the national GDP could shrink by Rs3,000 billion with the GDP down to minus 0.38 percent in the year 2019-20.
Presenting the Economic Survey of Pakistan 2019-20 at a news conference in Islamabad, Hafeez Shaikh repeatedly said that it was difficult to calculate or estimate the losses as he asked the media persons not to rely on any figures.
Unlike the past years, the unveiling of the Economic Survey was a low-key event with a very short address followed by aggressive questions in the Q&A session which shows what kind of budget is to be presented on Friday.
Hafeez also admitted that there would be a cut in remittances and revenue collection would be around Rs3,900 billion, representing a shortfall of Rs800 billion.
Pakistan's loans increased to Rs25,000 billion, he said, adding that the amount would be around Rs30,000 billion if the total debts and liabilities were added up.
The advisor to the prime minister said the industrial and services sectors witnessed a negative growth (minus 2.64 percent and minus 0.59 percent respectively) while the agriculture could not meet the set target and stood at 2.67 percent.
However, he promised that the next budget would not contain new taxes or any increase in the existing ones so that financial burden is not increased on people.
Hafeez claimed that the incumbent government inherited economic crisis from the past, which controlled the expenditure and reduced the deficit by 73 percent.
"This was the first time, I think, in the country's history, and our primary balance –meaning our expenses were less than our earning — went into surplus," he added.
The current account deficit has been reduced to $3 billion from the previous level of $20 billion, he said.
However, he could not give satisfactory answers when asked if he could cite anything other than the current account deficit and whether the economic targets would have been met if there was no pandemic.
No new loans were obtained to pay back the previous ones, Hafeez claimed and thanked Chief of Army Staff General Qamar Javed Bajwa to freezing the defence budget. No new loan was taken from the State Bank of Pakistan, he added.
He said they were trying not to impose any new tax in the next federal budget due be presented in the National Assembly on Friday.
Hafeez Shaikh said the government took loans to tackle the burden of the debt left by previous governments. “Pakistan returned Rs5,000 billion in debt- the loans of the past years,” he said.
The advisor said that Covid-19 has pushed the global economies towards a recession, adding that Pakistan has also been affected by economic shocks caused by the outbreak of coronavirus.
Earlier, Prime Minister Imran Khan was presented Economic Survey 2019-20.
Hafeez Shaikh presented the copy of Economic Survey to the Prime Minister in a meeting held in Islamabad, the PM Media Wing said.
The federal government is set to present its Budget for the fiscal year 2020-21 on Friday, June 12.