Islamabad, 11 June 2024(TDI): Pakistan’s top economic body on Monday approved various proposals for the upcoming budget regarding the inclusion of the China-Pakistan Economic Corridor (CPEC) and foreign investment projects in the development plan.
The National Economic Council (NEC) in Islamabad started after Prime Minister Shehbaz Sharif presided over a meeting.
The forum evaluated the development budget for fiscal year 2023-24 and received briefings on proposals for development plans for fiscal year 2024-25, starting on July 1.
Pakistan’s coalition government is expected to lay out ambitious fiscal targets for the fiscal year 2024-2025 (July-June) budget on Wednesday which would help strengthen its case for a new bailout deal with the International Monetary Fund (IMF).
The council informed that they will give priority to CPEC projects, international investment projects, and ongoing projects close to completion in the upcoming development budget.
In addition, the development budget will include sustainable development goals (SDGs) and prioritize backward areas. The Council approved these measures.
Beijing is investing over $65 billion in energy and infrastructure projects in Pakistan as part of CPEC, a major segment of Beijing’s Belt and Road infrastructure initiative, which will connect China to the Arabian Sea and help Islamabad expand and modernize its economy through a network of roads, railways, pipelines and ports in Pakistan.
Along with talks with the IMF to support the dwindling $350 billion economy, Islamabad has also been making ambitious efforts to boost foreign direct investment in the country and has seen a flurry of high-level exchanges with Saudi Arabia, Japan, Azerbaijan, Qatar, and other countries in recent months.
Speaking at the meeting, Prime Minister Sharif said his government would ensure the best utilization of available resources for the economic revival, welfare of the masses, and development of the country.
“The federation will consult with provinces and stakeholders to make decisions through collective wisdom and consensus for economic revival of the country,” he said.
The council also received a detailed briefing on the 13th five-year development plan, which includes the development of all regions. These include increasing exports, promoting small and medium-scale industries, enhancing social security and poverty alleviation, improving workforce efficiency, advancing knowledge economy, and implementing a strategy to mitigate adverse effects of climate change.”
Pakistan is in talks with the IMF for a loan estimated to be anything between $6 billion to $8 billion to avert a default for an economy that is growing at the slowest pace in the region.
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While the country has brought its fiscal and external deficits under control, it achieved this by experiencing a sharp drop in growth and industrial activity, along with high inflation.
In the last financial year, inflation averaged close to 30 percent and 24.52 percent over the last 11 months.
Analysts expect the growth target for the upcoming year to be higher at 3.6 percent, compared to 2 percent this year and the economic contraction last year.
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