Finance Minister Muhammad Aurangzeb has said that the government has no alternatives but implement economic reforms as part of its agreement with the International Monetary Fund (IMF).
In his discussion with the IMF Director on Wednesday, the minister highlighted the urgency of economic reforms for the country, reiterating the government’s resolve to implement them.
The finance minister’s assurance comes hours after a top IMF official stressed that the country should stay on the course of reforms that were instrumental in securing crucial funding from the lender.
The minister, leading a high-level delegation met with IMF’s Director of Middle East and Central Asia Department, Jihad Azour, in Washington on Tuesday. He outlined the government’s efforts towards fiscal consolidation, revenue expansion, energy and SOE reforms, aimed at transitioning Pakistan from stabilisation to growth, according to a statement issued by the Ministry of Finance.
Aurangzeb is currently in Washington leading the country’s delegation to the Annual Meetings of the World Bank Group and IMF, being held in Washington DC from October 21-26.
Other delegates include Finance Secretary Imdad Ullah Bosal, Secretary Economic Affairs Dr Kazim Niaz, and State Bank of Pakistan’s Governor Jameel Ahmad, the ministry added.
In his discussion with IMF officials today, Aurangzeb, who is tasked with navigating the country through a challenging economic situation, pointed out that the government is taking decisive action to address the issue of broadening the tax net.
“We will bring tax evaders into the tax net,” he stressed, signalling stricter enforcement of tax policies.
The minister also highlighted a shift in the country’s approach to long-term economic growth. “We want to rely on investment rather than aid,” he stated, emphasising the government’s intention to attract more foreign and domestic investments.
The minister also outlined the government’s plans to privatise loss-making state-owned enterprises, an essential part of Pakistan’s strategy to cut down the fiscal deficit.
Aurangzeb acknowledged that the federal government’s spending is also under scrutiny, saying, “We are also cutting the volume of federal government’s expenditures.”
Moreover, pension liability is a major challenge for Pakistan, he remarked, suggesting that reforms in the pension system are also on the horizon.
