Top 7 economic steps by PTI Government that shaped Pakistan’s future
The economy was the main challenge for the present PTI Government.
Since elected, PTI has been focusing on the stabilization of Pakistan’s economy.
PTI Government focused on promoting exports, discouraging imports, broadening tax net and curbing money laundering.
Also, the government took steps to encourage remittances through legal channels, as Pakistan has the potential to receive $40 billion annual remittances.
The British Airways returned to Pakistan after a decade, France has improved its travel advisory for Pakistan and Germany is also considering on the same lines.
For foreign asset holders, a tax amnesty scheme was launched during the first half of the year. And now, the State Bank of Pakistan imposed strict regulations on asset inflows and outflows.
The government has signed $10 billion offshore gas pipeline deal with Russia, and also a deal with Saudi Arabia to establish an oil refinery.
$3 billion each provided by Saudi Arabia and the United Arab Emirates (UAE) to maintain foreign exchange reserves.
In 2018, Pakistan saw its economy buckle under increasing pressure, foreign exchange reserves have been decreased, the increment in trade deficit and circular debt.
Let’s take a look at the major economic developments by PTI Govt that shaped Pakistan’s future.
1. Chinese tech giant Alibaba breaks into the Pakistani market by acquiring Daraz
By fully acquiring the Daraz Group, China’s biggest e-commerce company, the Alibaba Group, broke into the Pakistani market in May.
With this achievement, Daraz is able to influence Alibaba’s leadership and experience in technology, online commerce and mobile payment.
Daraz will also influence the logistics to drive growth in the five South Asian markets, having a combined population of over 460 million.
Alibaba Group can empower the businesspersons to better serve consumers in the region through their technology and expertise.
Daraz believes that a technology-enabled commerce ecosystem will play a critical role in driving the long term economic development in South Asia.
2. Saudi Arabia pledges $6bn package to Pakistan
After weeks of discussion, Saudi Arabia offered a $6 billion bailout package to Pakistan for the betterment of Pakistan’s economy.
The package included $3bn balance of payments support and another $3bn in deferred payments on oil imports.
Saudi Arabia also agreed to provide one year deferred payment facility for import of oil. The Saudi package will help PTI Govt in dealing with economic challenges.
3. PM forms Council of Business Leaders
Prime Minister Imran Khan formed a 22-member Council of Business Leaders (CBL). This council is made to suggest measures for increasing investment, boosting exports and improving Pakistan’s ranking in ease of doing business.
The CBL is headed by the Prime Minister. He ensures the implementation of those decisions that are required for the promotion of exports and the resolution of current account deficit issues.
4. Pakistan’s ‘Doing Business’ ranking up 11 notches
World Bank issued the ‘Doing Business Report Training for Reform 2019’. The report presented that Pakistan’s ranking has improved by 11 points, moving from 147th to 136th position.
The introduction of reforms, along with other positive data corrections contributed to the unprecedented improvement in ranking of Pakistan.
Also, this improvement is a result of a combined effort under the Prime Minister’s Steering Committee on Doing Business Reforms.
5. China agrees to almost double its imports from Pakistan
Beijing agreed to increase its imports from Pakistan to $2.2 billion from $1.2billion by end of 2018-2019 and to $3.2billion by end of next fiscal year.
This development is a result of after the Prime Minister’s first official visit to China and China has assured every kind of assistance to Pakistan.
Pakistan and China also agreed for cooperation in various sectors including agriculture and the elimination of poverty from the country.
6. The rs82bn plan launched to reduce rural poverty
Rs82 billion plan for the agriculture sector, unveiled by the Ministry of National Food Security and Research (MNFSR).
This huge plan is a part of PTI’s 100 Days Agenda and will be implemented within two to three years.
The overall objective of the plan is to uplift small farmers and reduce rural poverty. The plan is aimed at the enhancement of crop yield, improvement of water efficiency, livestock, fisheries development, and creating agro-markets.
7. UAE pledges $3bn to boost Pakistan’s liquidity, reserves
The United Arab Emirates (UAE) announced its plan to deposit $3 billion that would be helpful to enhance liquidity and monetary reserves of foreign currency at the bank.
The support from UAE is based on the historical ties between the two countries and the desire to further develop the bilateral cooperation in all fields.
This amount will also help in strengthening the rupee and will reduce Pakistan’s reliance on foreign funding and control its current account deficit.
The economic team of the government worked hard to enable Pakistan to stand on its own and in just four months, PTI has done a number of economic developments.
The previous PML-N government spent $7 billion to keep rupee overvalued that brought destruction to the economy.
But now due to the clean governance of the PTI Govt, the international perception in Pakistan is improving.
From around 1.1 million in 2017 to around 1.5 million in 2018, the filing of tax returns has been improved.