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Budgetary targets ambitious but achievable amid Coronavirus uncertainty, says Hafeez Shaikh

Adviser to the Prime Minister on Finance and Revenue Dr Abdul Hafeez Shaikh on Friday described the budget for the next fiscal year as “ambitious”, but admitted that whether the government achieves its targets would depend on the fallout from the Covid-19 pandemic.

“Our targets are ambitious. But there’s a lot of uncertainty. If the coronavirus [outbreak] gets out of hand and lockdowns are imposed again, we will have another situation on our hands,” he said.

He expressed these views while speaking to Geo News host Shahzeb Khanzada.

He said that tax collection wasn’t the government’s priority right now due to the economic impact of the coronavirus outbreak. “Our priority is to provide relief to people. That’s why we didn’t impose any new taxes.”

Shaikh said, however, that he was confident that if the coronavirus situation “worked out well”, the government will be able to achieve its targets for the next fiscal year.

“If our economy picks up after two months, we can expect to achieve our targets,” he said, adding that improvements in the agricultural and manufacturing sectors would enable the government to “do well overall”.

Shaikh also pointed out that uncertainty in other global economies also have an impact back home. “If their economies improve, our exports will rise which will also impact our economy.”

Commenting on the government borrowing money, the PM’s aide said: “We will try to borrow as less as possible, that’s primarily why we have been reducing our expenditures since day one.

“But you must understand that some things are out of our hands. We need to repay the loans that were taken by previous governments.”

He also elaborated on the government’s development budget. “When we were finalising it, the premier instructed us to cut current expenditures, and I agree with his point of view.

“I think that our immediate focus should be to invest in projects that do two things: create jobs and yield results in the short term.”

Touching upon the government’s credibility after its failure to meet economic targets, the PM’s aide reasoned that the figures were provided by the Pakistan Bureau of Statistics (PBS).

“They are an independent organisation. The government on its own has got nothing to do with the gross domestic product (GDP) and other estimates. We want to give more independence to bureau.”

Stating that it was a “good thing” to acknowledge one’s shortcomings, he added: “Now our job as the government is to increase the technical qualification at PBS.”

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