ISLAMABAD - Federal Minister for Planning Ahsan Iqbal has said that circular debt is a huge challenge for the country. “We will have to get rid of loss-making state owned entities by privatising them, he said while speaking at a seminar.

Speakers at a seminar were of the opinion that state owned enterprises are incurring a loss of Rs 1300 billion annually. They said government needs to slash the energy prices, control circular debt and get rid of loss-making SOEs. The seminar was organized by the Ministry of Planning, Development and Special Initiatives. Federal Minister for Planning Ahsan Iqbal, while addressing the seminar, said that development is not possible without export promotion and political stability. Apart from political stability, continuity of policies is essential, he added.

“For future, we have to go from 10pc to 18pc tax to GDP ratio,” he said. The planning minister said that the days of public sector investment are over. “Now it’s time for private investment as the government’s job is to provide facilities. Foreign investment in Pakistan is very low which is up to $1.8 billion annually only. The minister said that “when I went to Malaysia, they told me that we learned by seeing your progress in 1960”. In 1998, Pakistan had electricity surplus but after 2006 there was energy shortage, the minister added.

Counting the contribution of PML government, the minister said: “We gave Vision 2025, made CPEC a reality and brought an investment of $29 billion in four years.” The whole world was looking for investment in Pakistan, when I left this ministry in 2018, the PSDP allocations were Rs 1000 billion. “When we came again in April 2022, PSDP size was Rs 550 billion” he said, adding that what can you build in Rs 550 billion PSDP for a population of 220 million?

“In 1960s, Pakistan’s exports were more than South Korea, Malaysia, Thailand, however, today they are all above us,” he said. All developed states in history adopted an export-oriented model.

Government needs to slash energy prices, control circular debt and get rid of loss-making SOEs

Former Finance Minister Sartaj Aziz’s said: “Unfortunately after Mangala and Tarbela we did not do any water projects”. Cheap electricity is essential for development; he said and added that expensive electricity is increasing circular credit. He said that Pakistan’s population rate is very high and effective policy is necessary for population control. A rapidly growing population creates social problems. He said that public sector entities are incurring Rs 1300 billion losses annually.

Former Governor State Bank Dr  Shamshad Akhtar, while addressing the seminar, said that Pakistan’s banking sector is performing well. Banks are earning good profits and also giving to their customers, she said. Pakistan’s banking financial system is better than India, Dr Shamshad claimed. Dr Shamshad Akhtar said that Pakistan is an attractive market for investment. There is more profit in Pakistani markets as compared to other local markets. However she said that the Pakistan’s debt market is small in comparison to its requirements.

Dr Ishrat Hussain emphasized the need to develop the private sector in Pakistan. He said that agriculture sector should be developed to ensure food security. Dr. Ishrat Hussain said that new industries should be established. The power sector should be fixed and innovation should be brought in PIA, he added. Dr. Ishrat Hussain said that improvement of governance is very important for the development of any sector.