Federal Minister for Finance and Revenue, Hammad Azhar Wednesday said the Economic Coordination Committee (ECC) of the cabinet has decided to import sugar and cotton from India to cater to the increasing demand and check rising inflation.
Addressing a press conference after chairing the meeting of the cabinet committee, Hammad Azhar, who also holds portfolio of industries and production, said the prices of sugar have increased all over the world, making it impossible for Pakistan to import. However, he said, the sugar prices in the neighbouring country are much lower compared to Pakistan, so the government has decided to open sugar trade through private sector with India and import 0.5 million tons of the commodity. He said the sugar imports from the neighbouring country will help improve the supply position and help check increase in the commodity pricess.
The minister said the ECC has also decided to import cotton from India to benefit small industry of the country. He said the cotton is in high demand in Pakistan after surge in textile exports while there was also not a good cotton crop last year. He said the government had allowed cotton imports from across the world but not from India, however it was affecting small industry which was facing difficulties in importing the commodity from far-off countries. “On the proposal of Ministry of Commerce, we have decided in the ECC to allow cotton imports from India,” he added.
Moving on to the economy, Hammad Azhar said that the PTI government ‘inherited the biggest current account deficit in Pakistan’s history and converted it into a surplus’. He said that when the PTI government came to power in 2018, Pakistan’s foreign reserves were around $8-9 billion, most of which were swaps or taken from other countries. “Since our government came, if we add swaps, there has been an increase of $9bn of which $6-7bn swaps were cleared. This is a very big achievement,” he stressed.
The minister said that he and his team were ‘aware’ of their responsibilities and the people’s expectations. “The stabilisation we have achieved in our current account, reserves, the growth in LSM (large-scale manufacturing), we will take these forward in a better way,” he added.
He emphasised that every policy of the government would be based on the benefit of Pakistan and its people, adding that it would work “day and night” to control inflation. When asked about Hafeez Shaikh’s removal, Azhar said that the former finance minister’s “ability and wisdom is not being denied” but it was the prerogative of Prime Minister Imran Khan to select and change his team.
Talking about the government’s raising of $2.5bn in bonds from the international capital market a day earlier, Azhar, in his conference today, termed the move as “very successful”. “We had more than 100 per cent subscription,” he claimed.
The minister said the government got “competitive pricing” for the bonds which were “better prices than what other countries who also floated their bonds on the same day received”.
In response to a question about the government’s proposed bill to make the State Bank of Pakistan (SBP) more autonomous, he said it had been drafted while keeping in view the “world’s best practices”. He said the government would table the bill in parliament with an “open mind”, adding however, that the way the bill was “sensationalised was not correct”.
The minister said due to Covid-19, the world, including Pakistan, has witnessed surge in inflation, however, the government will make all efforts to mitigate its effect on the people. “I and my team have full realization of the fact,” he said, adding the prices of ghee, sugar, and flour had gone up. “However, we would try our best to check it and wherever necessary the provincial and federal governments would coordinate to control it.”
He said the International Monetary Fund has transferred the tranche worth $500 million to the SBP, making the reserves’ position better. He said the reserves would get more strengthened after inclusion of $2.5 billion raised through the bonds.
To another query, the minister said the country’s economic growth was on track and would achieve the revised gross domestic product growth target by the central bank of three percent, if situation of third wave of Covid remains in control.
The minister said the subsidized essential items during holy month of Ramazan would be provided in extra quantity at all Utility Stores outlets as the subsidy amount this year was much more compared to the past years.
Replying to a question about privatization of Pakistan Steels Mills, he said the bidding of the PSM would be floated during current year.
