Islamabad (Commerce Desk) — Finance Secretary Imdadullah Bosal has said that a 50% reduction in fuel supplies for government vehicles would save only Rs700 million over three months, while a 5% reduction in non-salary expenditures for one year could save Rs16.1 billion. Overall austerity measures are expected to save Rs16.8 billion.
Briefing the National Assembly Standing Committee on Finance, chaired by Pakistan Peoples Party’s Syed Naveed Qamar, on the completion of two years of the IMF program, the Finance Secretary said overall implementation of the IMF program had been fairly strong; however, some conditions could not be fulfilled.
Imdadullah Bosal said three provinces had agreed to deregulate the sugar sector, while discussions were ongoing to address the concerns of one province. Under an IMF condition, the federal cabinet was required to approve a national policy to liberalize the sugar market by June this year; however, the government could not approve the policy within the stipulated period.
He said implementation of the IMF condition regarding taxation of agricultural income was also slow, while health and education targets could not be achieved because some provinces failed to make the required expenditures. The condition to align the laws of nine more public sector entities with the State-Owned Enterprises law had also not been fulfilled.
The Finance Secretary said the Prime Minister had assigned the Minister for Law and Justice and the National Accountability Bureau the task of preparing an action plan to reduce risks in 10 government departments with a high risk of corruption.
Standing Committee member Hina Rabbani Khar asked whether the government’s austerity campaign was merely for show; however, the Finance Secretary avoided giving a direct answer. Syed Naveed Qamar also expressed concerns over increasing the tax rate on agricultural income from 15% to 45%.