Political Confrontation Should Be Avoided In Economic Decision Making, Asad Umar

Federal Minister for Finance, Revenue, and Economic Affairs, Asad Umar said political confrontations have negative impacts on the economy and economic decision making which should be avoided to build consensus

Islamabad (UrduPoint / Pakistan Point News - 02nd April, 2019) Federal Minister for Finance, Revenue, and Economic Affairs, Asad Umar said political confrontations have negative impacts on the economy and economic decision making which should be avoided to build consensus.However, proceedings of tracking crime and upholding rule of law are not political confrontations, and this must be distinguished.

In the long run if there is a rule of law, justice in the society and supremacy of the constitution, we can help strengthen our economy, he added.Asad Umar stated this during a "Pre-budget Consultation and Book Launch titled "Growth & Inequality in Pakistan", jointly organized by Sustainable Development Policy Institute (SDPI) and Friedrich-Ebert-Stiftung (FES) Office Pakistan, here on Tuesday.Asad said our economic decision should be informed by sound economic theory and indigenous empirical research, as there is no substitute for grass root level research.

He said it is sad reality that Pakistan is an elite captured society and we all need to strive for a society and political system where elite influence can be mitigated. He emphasized the need for introducing and implementing wealth tax which has fundamental place in the advance economies.Abdul Razak Dawood, Advisor to the Prime Minister on Commerce, Textile, Industry and Investment said in the past we negotiated very bad Free Trade Agreements (FTAs) especially with China and we have the opportunity to renegotiate with better terms in the second phase of CPEC.

He informed that Pakistan has re-negotiated successfully FTA with Indonesia and got duty free unilateral access in on 20 trade items in Indonesian markets. On industrial policy he said the government will not provide any subsidies to the industries, but to help arrange funding for upgrading the industries on technology front.Hammad Azhar Minister of State for Revenue said there is a lot of debate on the adverse impacts of stabilization which should be seen and debated as necessary steps to rescue the economy.

He said there is no doubt that Pakistan has most complex taxation system which requires immediate reforms measures.There is little improvement in tax to GDP ratio in last years, which is largely through withholding, indirect and advance taxes, he added.

To correct this morass, we took decision of separating tax policy with tax administration and tax policy is no longer part of FBR which is now under ministry of Finance. He emphasized the need of reforming tax laws and deploying technology to by-pass FBR registration, complete elimination of interaction between a tax collector and tax payers and tracking every single notice of recovery.

Shandana Gulzar Khan, Parliamentary Secretary of Commerce and Textile urged the need for greater coordination among institutions, especially in agriculture sector, for enhanced effective and timely decisions.

She said if we wanted to be respected in the world, we need to be economically sufficient and independent.Sartaj Aziz, Former Deputy Chairman, Planning Commission of Pakistan said the most important objective of the incumbent government should be to maintain the growth momentum.

He urged the government to focus on agriculture sector, where rapid and quick growth with low investments can be achieved. He said the government should avoid cutting the Public Sector Development Program (PSDP) budget), otherwise it will harm the economy in the long run.Dr Hafiz A.

Pasha, Renowned Economist and Former Federal Finance Minister said in the elite captured society of Pakistan, one per cent farmers own 22 per cent of the land and 50 per cent small farmers own 11 per cent of the land, which shows the extend of inequality in an agrarian economy.

He said that the real test for the incumbent government is to broaden the tax to GDP ratio through direct and progressive taxation. He said there are at least 64 schedule withholding taxes, which should be abolish gradually.

He urged the government to levy tax on capital and real-estate market. He also urged the government to develop a home grown Medium term Fiscal Budgetary Framework and debt strategy for sustainable growth.Khawar Mumtaz, Chairperson of the National Commission of Women said it is unfortunate that there are high number of educated unemployed women in Pakistan, which are valuable and productive resource.

She called upon the government to consider the proposal of gender responsive budgeting in the forthcoming federal budget.Romina Khursheed Alam, Pakistan Muslim League (Nawaz) MNA said there is need of reviving confidence among the local investors, as local investors are taking out their investments from the country.Dr.

Abid Qaiyum Suleri, Executive Director, SDPI said for sustainable economy there is dire need of developing political consensus on the fundamentals of the economy and all stakeholders must also evolve agreement on the improved governance system of the country.Rolf Paasch, Resident Director, FES Pakistan while giving the welcome remarks said the flagship program of Economy of Tomorrow (EoT) is a flagship program of FES with the aim provide a blue print for sustainable and inclusive economic growth for all stakeholders.