Efforts on to cut civil govt, debt servicing expenses

Federal Finance Minister Muhammad Aurangzeb said on Friday that the government remains committed to macroeconomic stability and wants the economy to move past stabilisation toward durable growth. Speaking at an Asian Development Bank forum on private capital, PPPs and privatisation, he said the government is working to cut spending on running the civil government and on debt servicing, while conceding much remains to be done.

Aurangzeb credited better revenue collection after the FBR overhaul, with revenues up 40% over two years and the tax-to-GDP ratio rising from 8.8% to 10.3%. He set a target of 11-12% in the short term. He added that the structural twin deficit fell from 12.5% of GDP to 2.6% within roughly two and a half to three years, and that 27 transactions have been handed to the Privatisation Commission.

On the external side, he cited remittances and IT services exports, which reached $4.6 billion last year, including $1.6 billion from freelancers, while goods exports stayed near $30 billion. The minister also said Pakistan regained access to international capital markets after about four years, with a $3 billion issue whose order book was twice the offered size. He said the government aims for growth above 4% this fiscal year and reserves of $21 billion by year end, up from $18.4 billion on June 30.