The minister said despite immense challenges that were faced by the government on economic front, it had decided to introduce some structural reforms to correct the fundamentals of national economy for bringing long-term development and stabilization.
Due to these reforms, current account deficit had also decreased which would help reducing the pressure on foreign exchange reserves, he added. Asad Umar said that four components including exports, imports, remittances and foreign direct investment were the determining factors of current account deficit, adding that all these indicators excluding foreign investment were remained on the mark during the period under review.
He said that private sector credit off-take during the period from July-December, 2018-19 had also witnessed 65 percent growth as compared to 21 percent of last year which was the highest in last 13 years. The minister said that consumer inflation rate based on Consumer Prices Index (CPI) during first five months of the government of Pakistan People's Party was increased by 11.2 percent, it was increased by 4 percent in Pakistan Muslim League-N's regime, whereas the CPI had witnessed a nominal increased 0.4 percent in first five months of PTI government.
He said that year on year, CPI percentage changed by income quintiles and commodity groups was at lower level for low income group in 2018 as compared to the same period of last year, adding that the government had tried to provide maximum relief to the common man.
He said that current government after coming into power had announced that it would explore and utilize other alternative sources for economic development and stabilization, besides negotiating with International Monitory Fund (IMF).
The government was still in process of negotiation with IMF and as soon as any suitable programme for the betterment of national economy finalized, an agreement with the fund would be signed, he remarked.
Besides, he said that government was utilizing other available alternate options for fulfilling the financial requirements of the country and taking different measures for economic development and social prosperity of the country.
Replying to a question, the minister said that supplementary Finance Bill would be introduced to attract investment, promoting exports and facilitating the business activities in the country.
A press release from Finance Ministry adds: Government's policy measures have resulted in shrinking of trade deficit, decline in imports and increase in exports which augurs well for overall balance of payment of the country.
The trade deficit that stood at US$ 17.7 billion in July-December 2017 has shrunk by 5 percent to $16.8 billion in the corresponding period in 2018.
The overall imports from July-December 2018 have shrunk by over 2 percent from US $ 28.7 billion in July-December 2017 to US $ 28 billion in July-December 2018. This trend is even more pronounced in respect of imports under RD regime, where the import value has declined from US $ 5.2 billion in July-December 2017 to US $ 4.4 Billion in July-December 2018, showing a contraction of 16 percent (effective on 1994 tariff lines).
The trade balance in December 2018 compared to December 2017 shrunk by 19 percent from US $ 2.9 billion to US $ 2.3 billion. In December 2018, the imports in US $ term declined to US $ 4.3 billion compared to US $ 4.9 billion in December 2017 which reflects an import compression of over 12 percent. This trend is even more pronounced in December 2018 in respect of imports under RD regime (effective on 1994 tariff lines) wherein the imports declined from US $ 896 million in December 2017 to US $ 691 million in December 2018 (-23 percent).
Data indicates that the import compression measures taken in the supplementary Finance Act, 2018 have firmly taken hold and are now effectively curtailing imports as per policy regime of the government. The data on import of containerized cargo also has shrunk by (9 percent).
There is a growth in exports of 5.5 percent in December 2018 compared to December 2017. In the first six months from July-December 2018 exports have shown a growth of over 2 percent compared to the same period last year.