ISLAMABAD : Economic experts here on Saturday stressed the need for fundamental reforms in national economic system in order to reduce reliance on foreign and domestic debt for development and prosperity of the country.

Addressing a day-long 'Third National Debt Conference', they urged the need for enhancing the competitiveness of local industrial sector to promote domestic exports and reduce the imports.

Addressing the conference, Member of National Assembly Asad Omer stressed the need for introducing grass-root level reforms to enhance the industrial competitiveness and to promote the exports. He also urged for enhancing the expenditure in research and development activities, particularly in agriculture sector as the farm productivity and output was reducing in the country as compared to the other countries of the region.

Asad also asked for reforms in local taxation system for increasing the revenue collection to fulfill the developmental expenditures instead of domestic and external lending. He called for reducing the share of indirect taxes, which he said comprised about 87 percent of total revenue collection and asked for encouraging the direct taxes. The competitiveness could be achieved by institutional reforms that would boost the performance of all local organisations and reduce the reliance on foreign as well as domestic debt, he added.

Speaking on the occasion, Director General of Directorate of National Saving, Zafar Masud, said that national debt swelled due to increase in development expenditures in different social sector development projects. He said that China Pakistan Economic Corridor (CPEC) project would enhance the GDP growth by 2-2.5 percent as it is expected to create about 5 million new job opportunities.

He said that stock exchange was performing well, where as the country's risk premium also reduced by 200 basis points as the economy was expending. “We will be in comfort zone by next 4-5 years, adding that structural reforms and fundamental changes required to sustain these gains for sustainable economic development,” he added.

Addressing the event, Research Economist of Pakistan Institute of Development Economics, M Ali Kemal, said that higher growth would enable to reduce foreign debt and said that in 2015 domestic debt was recorded at 44.5 percent of GDP where as external debt was about 18.7 percent. He said that higher economic growth was vital for reducing the burden of debt.

Speaking the conference, State Bank of Pakistan (SBP) former governor Shahid Hassan Kardar said that debt strategy required for reducing the burdens of foreign and local liabilities.