Islamabad (Staff Report): Federal cabinet on Friday approved FY 2017-18 budget.
The cabinet meeting was held under the chair of Prime Minister Nawaz Sharif, in which FY 2017-18 budget was approved.
Finance Minister Muhammad Ishaq Dar will present the budget in the National Assembly today (Friday).
On Thursday, On Thursday, Dar said that Pakistan's Gross Domestic Product (GDP) had grown 5.28 percent in fiscal year 2016-17 (FY17), against the target of 5.7pc.
While unveiling the Economic Survey 2016-17 in a press conference on Thursday, Dar said this year’s growth rate is highest in 10 years, adding that 3.4 percent increase has been recorded in electricity, gas supply in the existing fiscal year.
The minister said that forex reserves have reached nearly $21band, the industrials sector grew by 5.02pc, agriculture 3.46pc and Services 5.98pc.
"We are now targeting 6pc growth for next year," he said and added that the government also met its budget deficit target of 3.8pc, with the actual deficit registering at 3.7pc.
The government missed its trade deficit target of Rs 20.4 billion, with the deficit widening to Rs 24 billion in the period reviewed, the minister said.
The current account deficit expanded to $7.25bn for the year, and is expected to reach 2.7pc of GDP by the end of this year.
Remittances are expected to reach $19.5bn for the year, while foreign direct investment is expected to reach $2.58bn in FY17.
Kissan package worth 341 billion rupees has paid the dividends to raise its growth to 3.46 percent this year.
Under the Kissan package, he said the agriculture inputs including fertilizers were subsidized. He said the production of different major crops also witnessed an increase during the period.
Wheat crop production remained 25.75 million tonnes this year as compared to 25.63 million tonnes last year.
Cotton production remained 10.6 million bales this year as compared to 9.92 million bales last year.
He said efforts are being made to further improve cotton production in order to domestically meet the demand of textile industry.
About the agriculture credit, he was confident that it will achieve the target of seven hundred billion dollars this year.
Ishaq Dar said inflation according to Consumer Price Index was 8.69 percent in 2013-14 and it is is expected to close at 4.09 percent at the end of the current financial year as a result of measures taken by the Government.
He said exports are the area of concern and the Government is focusing on it. He said exports are 17.91 billion dollars in the first ten months of the current fiscal year. He said the exports are likely to close at 21.76 billion dollars. He said package given to exports has been enforced and this will continue during the next financial year.
He pointed out that imports of the country have increased to 37.40 billion dollars during the first ten months of current fiscal year as compared to 33.44 billion dollars during the same period last year. These are expected to close at 45.48 billion dollars at the end of the year. He said import of plants and machinery have been increased by forty percent which good for the growing economy.
Finance Minister said current accounts deficit is expected to close at 8.3 percent this financial year.
He said remittances are expected to close at 19.5 percent this year showing a decline of 2.6 percent. He said Foreign Direct Investment has increased to 1.73 billion dollars during the first ten months of this year as compared to 807 million dollars during this period last year. He said it is expected to reach 2.58 billion dollars. He said at present foreign exchange reserves stand at just under twenty billion dollars. He said exchange rate as of 22nd of this month was 104.87 which is satisfactory.
Ishaq Dar said per capita income was 1333 dollars in 2013 which has increased to 1629 dollars.
Upbeat about the performance of stocks, the Finance Minister said the market capitalization has doubled over the last four years. He said the decision of merging different stocks into Pakistan Stock Market helped earn the status of best performing market in Asia and the fifth largest in the world.
He was confident to close the financial year at the fiscal deficit of four point two percent which was eight point eight percent when the present government assumed power.
About the net public debt, the Finance Minister said it stands at 18892 billion rupees which is 59.3 percent of the GDP.
Ishaq Dar said that FBR is expected to achieve the revised collection target of 3521 billion rupees, Radio Pakistan reported.
About the war on terror, the Finance Minister said that it has cost the country 123.13 billion dollars. He said the country is annually spending ninety to one hundred billion rupees in the war on terror. He said that one hundred billion rupees will be set aside for the next fiscal year for the rehabilitation and reconstruction of tribal areas. The amount will also be used for raising new wings of civil armed forces.