Following is the text of budget speech delivered by Federal Finance Minister Senator Ishaq Dar
in the National Assembly on Friday:
As I rise to present the 4th Budget of our Government, the prime minister and the leader of the Parliament is recovering very fast after undergoing surgery. Prayers of this House, entire nation and millions of people from around the world are with him for his speedy recovery so that he can come back and take charge of the country’s leadership.
When we remember the economic challenges that were faced in June 2013 and the journey we had passed in the past three years under the leadership of Prime Minister Nawaz Sharif, we thank the blessings of Allah bestowed upon us, Alhamdulillah, the dangers faced to the economy are over, and the country is on the path to stability and growth. Those who had predicted Pakistan’s default by June 2014 have been defeated. We have not only prevented the country from economic default but also have stabilised the economy. Today international organisations are taking Pakistan’s name with respect.
We had a well-defined response for this purpose, which we had articulated in our Manifesto before the 2013 general elections on the basis of which we won the national elections. Our challenge was to put them in action and diligently remain on course until their fruits were borne. We have done precisely this and have not only prevented default but have solidly stabilised the economy and reinvigorated growth. Today, Allah has honoured us to present the 4th Budget of the country and in every budget we have done better than the previous one and all economic indicators testify to this claim.
Comparative Economic Performance 2012-13 vs. 2015-16
4. I would like to place before this august House the following key economic indicators, based on 9 or 10 months data or projected for the full current fiscal year (2015-16) in comparison with the situation that existed in a similar period or at the close of FY2013 or at End-June 2013:
1) Economic Growth, in the past two years, has remained above 4% in the past two years, and during FY2015-16 has been provisionally recorded at 4.71 per cent which is highest in the previous eight years. This performance could have been better if the cotton crop had not witnessed the loss of 28% due to which national economic growth was reduced by 0.5 per cent.
2) Per Capita Income, which stood at $1334 in FY2012-13 is projected to increase to $1561 in FY2015-16, showing a growth of 17 per cent in dollar terms, while it increased by 24 per cent in terms of rupee;
3) Inflation, which had averaged around 12 per cent during the period FY2008-13 before our government, was recorded at 7.4 per cent in FY2012-13. In the period Jul-May FY2016, the average inflation was recorded at 2.82 per cent, the lowest in a decade. This also means that the revival in growth has not been accompanied by rising in prices;
4) FBR Revenues had recorded an increase of merely 3.38 per cent in FY2012-13 when collections stood at Rs.1,946 billion. For the current FY2015-16 the target of RS.3,104 billion has been fixed and considering the collections to date, Inshallah this target will be achieved. This way tax revenues will be increased by 60 per cent which will be a historic increase. The tax to GDP ratio for FBR taxes that was 8.5 per cent in FY2012-13 has been increased to 10.5 per cent in FY2015-16.
5) Fiscal Deficit was 8.2 per cent of GDP in FY2012-13 is being brought down to 4.3 per cent of GDP in FY2015-16;
6) Credit to Private Sector that was negative Rs.19 billion in FY2012-13 has reached Rs.312 billion till May of current fiscal year;
7) Policy Rate of SBP was 9.5 per cent in May 2013, which has now been brought down to 5.75 per cent as on May 2016 which is the lowest rate in the past four decades.
8) Exports were $20.5 billion during Jul-Apr FY2012-13. Against this, exports for the same period in FY2015-16 were recorded at $18.2 showing a decline of 11 per cent. The main reason for this decline is global commodity prices.
9) Imports were recorded at $33.0 billion during Jul-Apr FY2012- 13 compared to $32.7 billion for the same period in FY2015-16. Savings in the import bill of oil were nearly 40 per cent but we diverted these savings to increased imports of machinery and industrial raw materials, thus enabling more growth-oriented activities. The imports of machinery over the last three years have increased by a cumulative growth of 40 per cent, which is again an indication of rising investment in the economy;
10) Remittances were recorded at $11.6 billion during Jul-Apr FY2012-13, which has risen to $16.0 billion for the same period in this fiscal year FY2015-16, For the current year target is $19 billion for which efforts of devoted Pakistani overseas workers and professionals are admirable. Read more