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Economic Progress Of Pakistan During Two Years Of PTI Government

Not to mention that there are many milestones achieved in these two crucial years of PTI government, our core focus is to draft this article based on the achievements recognized and praised by the International communities, especially by the World Bank and the United Nations in the economic progress of Pakistan.

PTI Government implemented almost 300 reforms to improve business climate since 2016

PTI government is making the business environment highly attractive to induce more investors. In the last two years, the Government took serious initiatives in all the ten business indicators of the E.O.D.B reforms.

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What is EODB?

The EOBD Ranking is based on ten-scores. The economies are ranked on their ease of doing business and based on starting and operating local firms for their citizens or foreigner. The ranking covers ten-topics. Each topic is given equal weight and determined by sorting the aggregate scores consisting of several indicators.

Pakistan Ranking gets better in EODB by World Bank

The Ease of Doing Business Pakistan ranking in its DB score presents a positive side of Pakistan.

Ease of Doing Business is an index created by the leading economists of the World Bank

In 2019 Pakistan was in the 136th position among 190 countries. It is an outcome of the incumbent Government policies Pakistan climbed 28 places and was placed at 108th position. Total Seventy-three reforms and thirty data challenges have been submitted to the World Bank for improvement in Doing Business report 2021.

INVESTMENT PROMOTION STRATEGY 2020-2024

World Bank and Board of Investment are devising Investment Promotion Strategy. PTI Government also drafting a new Investment Law BIT – Bilateral Investment Treaty and would be presented to the Federal Cabinet for approval. The government is committed to making Pakistan business competitive by reducing the compliance burden. Pakistan Regulatory Modernization Initiative (PRMI) is reviewing existing requirements and eliminating unnecessary requirements by automation of all steps for approvals. With the establishment of Pakistan Business Portal, the initiative plans to be completed by 2023. it will increase the levels of ‘Doing Business’ in Pakistan.

National Highway Authority NHA (restructuring)

The restructuring of the NHA was necessary. There were no serious efforts made in the last two years to increase the NHA revenue. The strengthening of East-West connectivity and cross border interprovincial connectivity is enhanced. NHA Revenue increased from Rupees Thirty-Three billion (2018-2019) to Rupees 50.068 billion (2019-2020) with four CPEC Projects completed with 0.73 million trees were planted.

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Pakistan Post – An unattended Nation’s Courier Service

Pakistan Post was not able to attract new customers. Increasing the deficit was needed to be eliminated. The conversion of a manual process into digital and introduction of new products are the key objectives of the PTI Government. The deficit was reversed first time in 10 years and opened Postal Rest House for General Public.

FINANCIAL OBJECTIVES OF THE GOVERNMENT OF PTI

The reduced current account deficit and increased Exports are the main focus of the PTI Government. We will know that Pakistan’s exports have relied on traditional export sectors. The trade deficit has always remained a problem. In 2017-2018 trade deficit stood at US$ 37.6 billion. In 2019 it was reduced to US$ 23.1 billion in 2019.

READ ALSO: Pakistan’s economic situation after COVID-19; Pakistan at a glance.

Exports Policies and Initiatives

A regulatory duty imposed on non-essential imports reduced the import bill by 6.8% in 2019 and up to 19% in 2020. The Current Account Deficit was narrowed by 30% during 2019 and by an additional 73.6% during 2020.

PTI Government provided a Long-Term Finance Facility @ 6.0% & Export Refinance Facility @3.0% percent for business facilitation in Financial Year 2020

Facilitating the Exporters is PTI Government’s top priority. EEF (Export Enhancement Package) of PKR 180 billion has been enhanced for three years 2018-21.

Ministry reduced import duties on 1639 Tariff Lines of raw materials. Import duties on 1600 Tariff Lines have been reduced to zero in the annual budget 2019-2020. Rupees 3.31 billion Duty Drawback schemes of Textile Policy and Prime Minister Incentive Package was granted in 2019.

ENERGY & POWER SECTOR

DISCO Initiative in POWER SECTOR

Decreased Line Losses (DISCO) by 1.4%. Target assigned to DISCO to recover PKR 8b from old receivables. DISCOs have shown a record cumulative collection of PKR 121.1b from October 2018 till June 2019. (Paste Page 57 table under this heading)

Saudi Development Fund – Saudi Oil on Deferred Payment for two years

Under the Saudi Development Fund, Saudi Arabia has provided oil import facilities to Pakistan valuing US$ 3.2 billion per year on a deferred payment basis. This facility is expected to extend for two years.

EURO-5 conformation to Fuel imports

The Cabinet Committee on Energy decided that all from August 2020, all imports shall conform to Euro-5 compliant specifications likewise from January 2020, all diesel oil reports shall be Euro-5 compliant.

Storage Capacity Increased

The storage capacity for Motor Spirit (MS) and High-Speed Diesel (HSD) has been enhanced from 0.49 million Metric Tons to 0.68 million Metric Tons and 1.222 million Metric Tons to 1.447 million Metric Tons respectively.

Revenue on petroleum products earned by the Government is as follows: (share Page 61 chart)

China Pak Free Trade Agreement (CPFTA) PHASE-II:

After eleven vigorous rounds of negotiations Government of Pakistan signed the Protocol to amend CPFTA in April 2019. Tariff Reduction Modalities (TRM) have been implemented from 1st January 2020 by both sides.

The Pak-China Free Trade Agreement is, based on zero-duty, for Pakistani manufacturers/traders to export around 313 new products to the Chinese market.

NTP – National Tariff Policy

National Tariff Policy (NTP) will play an important role in removing irregularities in import and Import duties structure and mobilize industrial production and grow exports.

Foreign Remittances

FDI for FY 2020 (July-May) was USD 2.4 billion, an increase of 91 percent as compared to the same period of last FY. Foreign exchange reserves of the State Bank of Pakistan stood at USD 12.17 billion at the end of June 2020.

FDI – Foreign Direct Investment

Between July 2019 to May 2020, Foreign Direct Investment was US$ 2.4 billion, an increase of 91% as compared to FY 2019. Now Foreign exchange reserves of State Bank of Pakistan are US$ 16 billion.

ECC – Economic Coordination Committee

The Economic Coordination Committee has approved the PKR 50.7b package to provide indirect cash flow support to the SMEs (Small and Medium Enterprises) via pre-paid electricity bills for May to July 2020.

Agriculture Reforms

To boost the Agriculture Sector and development of crop yield, water conservation, fisheries, and livestock, PTI Government has announced the National Agriculture Emergency Programme of Rs.277 billion.

NAYA Pakistan

PTI Government announced a special package for construction includes tax exemption & amnesty scheme, PKR 30bn subsidized for NAYA Pakistan Housing Scheme.

PBC Certificates & Sukuks Islamic Bonds

To allow Overseas Pakistanis to contribute towards greater Pakistan, PTI Government introduced PBC – Pakistan Banao Certificates. Improving the documentation of Pakistan’s economy, PTI withdrew the Forty-Thousand Rupees denomination prize bonds from circulation.

Shariah-compliant Bonds ‘Sukuks’ have been introduced after years of gap in the market. These bonds played a vital role also towards lowering the borrowing costs of the government.

FBR reforms

PTI Government contended for many reforms. For the optimization of tax revenues make FBR a modern and efficient organization while promoting taxpayers’ friendly environment in the country. The number of income tax return filers increased to 2.7 million in 2019 against 1.9 million in Tax Year 2017 is a record number of returns in a year. Rupees 3970b (provisional) in the financial year 2020 against Rupees 3843.8b in 2018, means 1.26b higher amount is collected.

Through FBR customized module FASTER Rupees 267 billion was refunded to the business community in the last two years.

PTI Government Initiatives for AFRICA, Middle East, GCC, Europe

Ministry of Commerce launched a ‘Look Africa Policy’ Initiative in 2017-2018. Ministry relocated/opened six new Commercial Sections to cover the top ten economies of Africa and organized the PATDC (Pakistan-Africa Trade Development Conference) in the Capital of Kenya on 30th January 2020. PATDC attended by the Ministry of Commerce. Thirty- seven members from African Countries and Eighty-Five companies from Pakistan also attend the Conference.

Trade Development Authority of Pakistan is going to participate in the mega event of EXPO 2020.

Qatar Government lifts the ban on Pakistani Basmati rice. 48000 Metric Ton rice is exported to Qatar.

The Strategic Economic Framework (SEF) signed between Pakistan and Turkey. Pakistan Turkey Business and Investment Forum organized by the Ministry of Commerce in partnership with the Turkish Ministry of Trade, and the Foreign Economic Relations Board of Turkey.

Trade dispute of US $93.5 million was settled between Pakistan and Russia.

Few more Initiatives by the PTI Government

Ministry of Commerce prepared a draft of the Strategic Trade Policy Framework 2020-2025.

‘Make-in-Pakistan’ was an initiative by the Government of PTI and approved by Prime Minister Imran Khan himself.

The Government of PTI design the National Tariff Policy 2020-2024.

The Federal Cabinet approved the E-Commerce Policy of Pakistan in October 2019.

PTI Government launched the construction of 23000 new low-cost housing units in collaboration with the Capital Development Authority.

PTI Government also created the Tourism Development Endowment Fund & National Tourism Strategy -2020-2030 & Action Plan 2020-2025 are developed to boost up the Tourism sector of Pakistan.

Import of organic Cotton is allowed through the (KPK) Torkham Border & also the duty-free import of Textile machinery has been continued.

PC-1 for Rupees 1.987 billion and 1.294 billion is prepared for Faisalabad Garment City Company and Lahore Garment City Company, respectively.

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Sohail Yousuf

Sohail Yousuf is a content writer at SPF. He is a Master's in International Relations and loves to write.

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