Govt unveils Rs8.4 trillion budget

The Pakistan Tehreek-i-Insaf (PTI) led government Friday unveiled Rs 8.4 trillion pro-people and business-friendly federal budget for the fiscal year 2021-22, with major focus on pursuing all-inclusive, sustained and robust economic growth through comprehensive planning and development.

Despite the severity of 3rd wave of COVID-19 pandemic, the incumbent government in its third budget made remarkable allocations to carry out out massive development projects and welfare activities for the downtrodden segments of society, besides promoting the agriculture sector to ensure food security and reduce dependence on imports.

Presenting the budgetary proposals in the National Assembly, Minister for Finance and Revenue Shaukat Tarin said the government steered the economy out of crisis and put it on the growth trajectory by pursuing prudent policies under the dynamic leadership of Prime Minister Imran Khan.

He said the country was now out of dangerous situation as the government took initiatives for its economic sustainability as evident from 3.94 percent Gross Domestic Product (GDP) growth rate during the current fiscal year.

The minister said it was for the first time that any government had to face a critical situation and it successfully put the economy on sustainable growth path.

He said the Current Account was now $800 million in surplus, as compared to deficit of $20 billion at the end of last government.

He said the previous governments had also manipulated exchange rate, which had adversely affected the economy, resulting into depletion of foreign reserves to $10 billion.

However, they increased the reserves by taking loans, which were now being repaid by the incumbent government, he added.

Tarin said the government had successfully fulfilled all the international commitments, besides putting the economy on growth trajectory. For the purpose, it had to take tough decisions, such as reducing public expenditures and enhancing revenues, he added.

He said during the current year, the agriculture sector did perform well despite locusts attacks and all the major crops, except cotton, witnessed positive growth.

Likewise, the services and the large scale manufacturing sectors also had considerable growth despite COVID-19 factor, he added.

The minister said one of the top priorities of incumbent government was to uplift the downtrodden segments, and for the purpose 40% of the total population was given cash transfers, besides providing relief to 15 million households across the country.

The finance minister said the government would focus on inclusive growth of economy next year and it had set a target of 4.8 percent.

He said the downtrodden segments would be fully taken care of as the government would adopt a ‘bottom-up approach’ to help upto six million households and saving them from ‘trickle-down effect’.

He said urban households would be provided up to Rs 0.5 million interest free loan each for businesses, while farmer households would be given Rs 150,000 interest-free loan for each crop, in addition to Rs 200,000 interest free loan on for buying tractors and agriculture implements.

Moreover, up to Rs 2 million loan each would be provided for low cost housing while every household would be provided health card, with one person of such unit imparted technical training, he added.

Tarin said the government would have to ensure 6 to 7 percent growth to accommodate the youth, as 65 percent of the population was below 30.

He said the government was evolving a comprehensive strategy, under which the farmers would be provided seeds, fertilizers, loans, tractors and machinery, besides setting up cold storages and commodity warehousing to help increase their income.

The minister said the country’s imports had gone down to 8 percent of the GDP, which were around 12 percent 15 years back. Efforts were afoot to enhance the exports for which special economic zones were being established for value addition, he added.
He said the housing and construction sector was also on priority as around 10 million houses were required. Due to the government’s focus, the sector had already witnessed increased activity.

The minister said for bringing improvement in the energy sector, the government had devised a comprehensive strategy, including the circular debt management plan and restructuring with the private power producers, incentives provided to the industry for increased use of excess electricity and necessary investment in power transmission and distribution to reduce system losses, announcement of electric vehicle policy, and induction of cheap power through hydro renewable energy to reduce overall cost.

In addition, he said, the government was working on finalizing short, medium and long-term plans in different sectors, including finance and banking, budget and debt sustainability, price stability, industry and exports, public sector enterprises and privatization policy, information technology, and domestic commerce.

The minister said the development budget was enhanced from Rs 630 to Rs 900 billion, which was an increase of around 40%. Its focus would be on developing food and water security, energy sector, improving critical road infrastructure, advancing implementation of CPEC, establishment of operations in Special Economic Zones, sustainable development goals, combating climate change, technology-driven knowledge economy, and removing regional disparities.

He said the government had announced the National Agriculture Emergency Programme to uplift agriculture and livestock sectors on modern lines covering crops, livestock, fisheries and water sector.

He said during the next fiscal year, Rs 1 billion would be spent on the Locust Emergency and Food Security project, Rs 2 billion for enhancing productivity of rice, wheat, cotton, sugarcane and pulses, Rs 1 billion for enhancing olive cultivation on commercial scale, and Rs 3 billion for improvement of water-courses.

The minister said for ensuring water security, the government was building water reservoirs, including small, medium and large dams, so that future water needs were safeguarded.

He said the thee larger dams – Dasu, Diamer Bhasha, and Mohmand dams – were the priority in the budget. Some Rs 91 billion had been proposed in the budget for ensuring water security, including Rs 57 billion for Dasu hyrdopower project, Rs 23 billion for Diamer Bhasha Dam, Rs 6 billion for Mohmand Dam, and Rs 14 billion for Neelum-Jhelum hydropower project.

The minister said the government was committed to fast tracking implementation of CPEC as to date 17 projects worth $13 billion had been completed and another 21 of $21 billion were underway, while additional 26 strategic projects of $28 billion were in pipeline.
Most of the projects were being completed on a timely basis, he added.

He said in the budget 2021-22, the key priorities were completion of Karachi-Lahore Motorway, near-completion of 120 km Phase-1 of Havelian Thakot and advancement work on 118 km Phase-II f Karakorum Highway, advancement of work on 118 km Phase-II of Karakorum Highway, advancement of work on Zhoa Kuchlak Road, and other projects. – APP