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FY 2014 targets: Dar satisfied with progress

FY 2014 targets: Dar satisfied with progress

ISLAMABAD: Finance Minister Ishaq Dar expressed satisfaction over the current economic condition and progress towards achieving targets set for the current fiscal year, saying the government strategy had yielded satisfactory results.

Chairing a meeting held to review state of economy, the minister expressed the hope that external inflows would improve considerably in coming months due to positive impact of GSP Plus. He expressed satisfaction over the fact that credit to private sector had increased to Rs 230 billion during January 2014 as compared to Rs 53 billion in the corresponding period last year.  During the meeting, Federal Finance Secretary Dr Waqar Masood briefed the Finance Minister on the measures taken to contain inflation so far.

He said that the government steps started showing results as reflected in the continuous decline in Sensitive Price Indicator (SPI) inflation over the past eight weeks including five weeks of December 2013 and three weeks in January 2014. The SPI measures price trend of 53 most essential items. The meeting was informed that essential items such as egg (farm), vegetable gee, onion, tomato, banana, red chilli, rice, basmati broken and wheat flour were showing decreasing trends, whereas there was stability in the prices of bread, beef, chicken farm, fresh milk, cooked dal, gas charges, matchbox, petrol, diesel and bath soap.

The meeting also reviewed the balance of payment position and the Finance Minister was informed that while the cumulative current account deficit stood at $1.6 billion, a current account surplus was posted in December 2013 ($285 million) on account of robust growth in remittances which increased by 9.5 percent on average as compared to the same period last year.

Moreover, exports showed an increase of 3.2 percent against 0.6 percent last year. Imports increased by 3.9 percent against 0.1 percent last year. It was also noted that growth in export of textile sector was very encouraging whereas the import of machinery had increased by 26.3 percent, which was a positive development.

Overview of the real sector was also discussed and it was noted that Large Scale Manufacturing (LSM) had shown a growth of 5.2 percent during July-November ’14 against 2.2 percent during the corresponding period of last year.

In agriculture sector, the arrival of 12.88 million bales of cotton had been reported up to January 15, 2014, showing a growth of 7.5 percent over the last year which is also a positive signal and would have multiplier effect on LSM and services sector and augment growth prospects during current fiscal year. The meeting was attended by senior officials of the Finance Ministry, including Advisor to the Finance Ministry Rana Asad Amin.