ISLAMABAD - Prime Minister Syed Yousuf Raza Gilani on Tuesday said the government had decided to hold local body polls in the federal capital.Addressing the participants of 96th National Management Course at the PM’s House here, the prime minister said, “I have decided to hold local body elections in Islamabad.”A mayor will head the local government in the federal capital like in Istanbul and Dhaka, he added. He said the establishment of local governments improved governance. But it is unfortunate that the provincial governments still have to hold local body elections. The prime minister said in democracy, the mandate of people should be accepted, and they had given a split mandate, which led to formation of a coalition government and “we have to live with it”.He said his government continued with the policy of reconciliation which should be taken as a strength and not as a weakness. He said the present parliament passed more than 100 laws and amendments which was a far better record than that of the past government with even two-third majority.“The policy of reconciliation and taking decisions with collective wisdom is working. We will have to work in coalitions. If we accept this, we will be able to move forward,” he noted.The prime minister said the democratic government was committed to the vision of Pakistan being a progressive, federal, democratic, pluralistic, moderate and peaceful country.The 1973 Constitution was a great achievement of the Pakistan People’s Party under the charismatic leadership of Quaid-i-Awam Zulfikar Ali Bhutto, he added.He said in order to restore the Constitution into its original form, the government evolved consensus among the political parties.He said the 18th Constitutional Amendment showed a rare consensus among all the political parties having representation in the parliament.A result of the passage of the amendment, the executive powers of the prime minister have been restored, parliament and the provincial assemblies have been strengthened and provincial autonomy has been expanded, with the abolition of the concurrent list, he added. This was a long-standing demand of the provinces and along with the 7th National Finance Commission (NFC) Award, this one measure alone has altered the framework of federal-provincial relations, Gilani said.He said the change in constitution opened up prospects for better governance by making provinces directly responsible to the people at the grassroots. “The 19th Amendment has ensured the independence of judiciary,” he said.Gilani said politically, the government had pursued a policy of `national reconciliation’, by following the vision of Mohtarma Benazir Bhutto.All political parties and groups, both within and outside the parliament, have been associated in the decision making process with regard to issues of national interest, starting with coalition governments, to the NFC Award, 18th, 19th, 20th Constitutional Amendments, to a more recent parliamentary resolution on relations with the United States, he observed.Gilani said he had a unique honour of being the first unanimously elected prime minister of Pakistan and the policy of reconciliation had indeed served the country well in the face of all difficulties and challenges.He said when the PPP government took over it inherited a fragile economic situation, balance of payment crisis, external shocks due to global recession and a huge fiscal imbalance.The fiscal deficit was 7.6 per cent, current account deficit had reached 8.4 per cent, fiscal space provided by the rescheduling of over 12 billion dollars loans in 2002 had been lost, growth had lost momentum, reserves began to deplete as the rupee fell and inflation peaked at unprecedented 25 per cent, he added.The prime minister said over the last four years the government took difficult decisions to get out of a threatening situation. “In particular we gave relief to our vulnerable segments. We have shown great discipline to reduce government expenditures. We have mobilised domestic tax revenues to lessen our dependence on borrowing to bridge fiscal deficit. We have achieved historic performance in our external sector. We are beginning to show stronger growth of the economy.”“The floods cost us over 2 per cent of GDP growth, and damage of around 10 billion dollars. We were also forced to cut other programmes to rehabilitate the flood and rain victims.”He said in spite of all the difficulties, the economy would grow by 4 per cent in 2012. He said exports crossed a historic benchmark of 25 billion dollars last year and the trend continued to register upsurge.Remittances were 11.2 billion dollars last year, and will double over the 2008 levels this year and in spite of global increase in the price of oil and food, the inflation has been coming down, he mentioned.“We have worked hard to bring inflation from its peak of 25 per cent in 2008 to 11 per cent now. We have taken steps to raise revenues. Our tax collections have doubled from 1,000 billion to about 2,000 billion rupees since 2008. This year the tax growth is the highest ever at 26 per cent. The stock market has begun to improve.”“The index has crossed 14,000 yesterday, the highest in four years, compared to around 7,000 in 2009. Dependence on food imports has been reduced. We estimate our wheat crop to be 25 million tons and cotton crop will touch 13 million bales despite loss of 2 million bales in floods in Sindh,” Gilani added.He said, “We are keenly working on ways and means to improve the energy infrastructure. We have already added 3,400 MW in the national power grid.”The prime minister said the government was aiming at long-term solution to bridge the rising demand-supply gap in the country. “We are working on hydropower dams both big and small such as Diamir Bhasha Dam Project, Neelum-Jhelum Hydro power, Tarbela Extension, Chashma Nuclear Power 3 & 4 and other renewable sources of energy like wind and solar power.”“In addition, we are tapping vast coal reserves. Iran-Pakistan gas pipeline, TAPI, and CASA-100 are some of the mega projects currently underway to find a permanent solution to energy crisis in the country,” he added.The prime minister said the government still faced with a host of problems, related to human development, particularly education, health, poverty, unemployment and “many of these problems, we have inherited”.