LAHORE:

Federal Finance Minister Muhammad Aurangzeb has declared that after achieving economic stability, the next priority is industrialisation to ensure sustainable economic growth.

He said the government was following an export-led policy and would soon announce relief measures for the construction sector. “The prime minister is expected to make a formal announcement.”

The government is also reviewing support measures for the textile sector and is considering reducing tax rates for the property sector.

Addressing the business community at the regional office of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), the finance minister emphasised that the government could not provide jobs to a population of 250 million, adding that job creation was the responsibility of the private sector, while the government’s role was to create a supportive environment.

Aurangzeb stated that digitalisation of the economy would bring transparency and increase revenue collection. He acknowledged that salaried individuals paid a higher share of taxes and the government wanted to provide relief to them.

He said the government was working to expand the tax net and was treating the real estate and construction sectors separately. Since construction is linked with many other industries, the government plans to support it. Issues being faced by the textile sector are also under review and decisions will be announced within 10 to 12 days.

The finance minister mentioned that the positive impact of the agreement with the International Monetary Fund (IMF) was becoming visible. Confidence of international institutions in Pakistan’s economy is being restored and the country is moving towards stability and growth.

He noted that tough but necessary decisions were taken to ensure economic discipline as at one point the country faced a serious default risk. He said that while the 2022 floods severely damaged the economy, the government now has the capacity to manage the impact of future challenges.

Aurangzeb highlighted the importance of IT exports, currently valued at $3-4 billion annually. The sector has the potential to reach $8-10 billion, however, he pointed out that a significant portion of export earnings remained abroad and should be brought back to the country.

He added that foreign exchange reserves held by the State Bank were steadily increasing, inflation had declined significantly and the government aimed to bring the policy rate down to single digits. When the current government took office, the country had only two weeks of import cover, whereas “now reserves are much stronger”.

Business leaders and representatives of export sectors attended the meeting and shared their proposals for economic improvement.