A special cabinet meeting was also held on Friday under Prime Minister Nawaz Sharif to consider and approve budget proposals for the next financial year.
Finance Minister Ishaq Dar briefed the cabinet regarding budget proposals, including targets set for the next financial year, both development and non-development activities.
He said the government devised a three-point strategy in 2013 to revamp the economy which include save the country from default, gaining macro-economic stability and in the third stage creating more opportunities for employment and reduce poverty.
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During his speech, the minister said economy of the country had largely been stabilized since 2013, when the PML-N-led government took over.
The GDP growth rate for the new fiscal year has been fixed at 5.5 percent, growth rate for agriculture sector at 3.9 and that of manufacturing sector 6.1 percent.
Export target for the year has been set as 25.5 billion dollars. He said fiscal deficit for the new fiscal year has been fixed at 4.3%.
Mr. Dar described that flooding and anti-government protests in mid 2014 were the main reasons that government could not meet its growth rate target of 5.2%.
The Finance Minister takes a break in his Federal Budget speech as the Azaan is sounded in the National Assembly.
He said Karachi Stock Exchange was now trading at 34,000 – an increase of 70%. He added that the interest rate had been reduced to 7%, which resulted in increase of investment.
Fiscal deficit fixed at 4.3%
The Finance Minister said fiscal deficit which was 5 percent during the outgoing financial year will be brought down to 4.3 percent in the next financial year. He said this achievement was made through increase in revenue collection and decrease in expenditures.
Finance Minister quotes an analyst from Morgan Stanley, Bloomberg News & an article from The Economist on how well the Pak economy is doing.
He said, by December 2017, a total of 10,600 MW will be added to the national electricity grid.
BISP allocation for 2015-16 has been increased to Rs 102 billion, Mr. Dar pointed towards the PPP benches and in a lighter tone urged for more clapping and desk-thumping.
The minister said: “We plan to increase GDP growth to 7% by 2017, bring fiscal deficit down to 3.5% and Tax to GDP ratio to 13%”.
He underlined that 217 places have been decided for setting up of universal learning centers. Besides, Rs.125 million for scholarships, decided last year for students of rural areas, will continue to be disbursed this year as well, he added.
Mr. Dar announced that Rs. 31 billion will be spent on water projects across the country.
Mass Transit System for Karachi
He said the “PML-N government will set up world class Green Line Bus transit system for people of Karachi.”