KARACHI: A growth target of six to seven per cent set by the newly appointed Finance Minister Shaukat Tareen seems achievable with effective and timely steps despite an economic slowdown due to COVID-19 and other constraints, the economists and analysts said.
“It is difficult but achievable with the right steps,” Khurram Schezad, CEO of Alpha Beta Core, said in a phone interview from Karachi.
“There are definitely many things for the new finance minister to take care of one by one: the power sector, tax and revenue, subsidies management and above all support the industry with production cost reduction to strengthen the export side against imports.”
“The country’s GDP growth must be increased by at least 6 to 7 per cent [to stabilise the economy],” Finance Minister Shaukat Tareen has said that based on his 49 years of experience in the economic sector, he knows what should be done to boost the country’s economy.
“While the target seems achievable with timely steps, it cannot be done overnight,” Schezad said. “I mean Shaukat Tareen or anyone should be given a reasonable time to navigate economy to the right course.”
On Friday, Prime Minister Imran Khan reshuffled the federal cabinet for the sixth time and appointed Shaukat Tareen as the country’s new finance minister.
Tareen has replaced Hammad Azhar, who was appointed as the country’s finance minister in March when the premier replaced Dr Abdul Hafeez Sheikh. Consequently, Hammad Azhar was appointed as the minister for energy, replacing Omar Ayub.
A few days ago while speaking to a private news channel, Tareen said: “We don’t know where the economy is heading and we will have to put our house in order.” The captain of the ship has to stand firm and be strong or the vessel won’t move ahead, he added. In another program, he said that “achieving Pakistan’s current economic goals was a difficult task, but not an impossible one”.
Muzammil Aslam, CEO of Tangent Capital said on the basis of current speed the growth is all set to clock at 4 per cent. “In my view, A little [more] focus on industry and agriculture will fetch five to six per cent growth. However, sales tax will follow the expansionary policies led by higher Public Sector Development Programme (PSDP) and housing,” he added.
“The expectation is to support consumer spending to gain industrial growth,” said an economist with the request of anonymity.
“Such practice seems suitable for a least documented economy like Pakistan, where the grey economy is almost the same size as the real economy, if not bigger. The stimulus to the consumer base can be soft loans, a type of financing that will create demand for the industries.”