Pakistani budget may freeze flour, gas prices

May 26th, 2008 - 12:38 pm ICT by admin  

Islamabad, May 26 (IANS) Pakistan’s budget for fiscal 2008-09 beginning July 1 could freeze the prices of flour, electricity and gas and offer special medical discounts for the elderly. Special measures to prevent tax evasion, relief for low-income groups, scholarships for poor students, smooth supply of flour to millers and retailers, besides diversion of resources from “certain sacred cows” to power-generation projects are also on the cards, The News reported Monday.

“If everything goes right, and the clash between parliament and the presidency does not culminate in putting off the budget speech, you will have unusual announcements this year,” it quoted a senior official involved in the budget-making process as saying.

Two parallel lists have been drawn up as part of the budgetary exercise: one for populist measures to be taken and the other for tough measures like slashing the administrative budget, monitoring spending and allocation on projects contracted out, revising the strategy for paying back loans, privatisation and deregulation of government assets and accountability of managers of state sector enterprises.

The populist list will be examined “for addition or deletion” by Prime Minister Yousaf Raza Gillani, Pakistan Peoples Party co-chair Asif Ali Zardari and the federal cabinet in the coming days, The News said.

“A list of tough actions will be examined at a final pre-budget meeting of senior bureaucrats, both retired and serving, even as private sector experts are engaged in charting out a fiscal agenda for long-term change in policies,” it added.

Once the two lists are cleared, the finance ministry will draft out the budget speech.

“The language will be carefully simplified to secure an impact, especially on the wider sections of the population,” The News said, adding: “The budget language is not going to be confusing this time. It is going to be more explicit than implicit”.

Interestingly, of the 45,400 industrial and commercial units registered in the country, 1,382 contribute 94.1 percent of the total tax collections while the rest faced lack of investments, lockouts or closure.

“In such an alarming situation, the economic downslide and inability to achieve growth targets paint a horrible picture, especially when inflation is hitting the poorest of the poor and even the middle-income group in an unprecedented way,” The News noted.

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