ISLAMABAD  -   Finance Minister Asad Umar on Monday admitted that the inflation rate is increasing due to the government’s measures taken for the economic stability of the country.

He said that the government is considering to present the budget for next fiscal year 2019-20 on May 24. “There is a proposal to announce the budget on May 24. However, a final decision for presenting the budget would be taken in consultation with the Speaker National Assembly,” the minister added.

Talking to the media after attending a ceremony of the State Bank of Pakistan here, Asad Umar admitted that the rise in the inflation rate is due to the steps the government has taken for the ‘economic stability of the country’.

Inflation rate is increasing but at lesser pace than it had enhanced in 2008 and 2013 when Pakistan People’s Party (PPP) and Pakistan Muslim League Nawaz (PML-N) had assumed the charge respectively, he added.

The finance minister said the government has not increased the prices of the oil products, which were recommended by Oil and Gas Regulatory Authority (OGRA). “We have passed on half of the proposed increase in petroleum products to the people by reducing our taxes,” he added. OGRA has recommended increasing oil prices up to Rs11.92 per litre but the government enhanced the prices by up to Rs6 per litre, he

added.

Asad Umar said the inflation would have to increase when the dollar value would increase to Rs140 from Rs105. Similarly, he said that oil prices in international market have gone to $68 per barrel from $32 per barrel, which is one of another reasons behind surging inflation. “The opposition should bring the record of my previous tweets and speeches, as I am ready to answer them,” he added.

Opposition parties, business community as well as common people are criticizing the government over increase in oil prices.

Asad informed the media that he would lead Pakistani delegation to the annual spring meeting of the IMF/WB in Washington, DC, from April 10 to 12. The IMF mission would visit Pakistan within this month to finalize the loan package. Loan from the IMF package would be small but it would put positive impact on dealing with other multilateral sources, he added.

Talking about shortfall in tax collection, he said the government is facing shortfall due to the reduction in imports, reduced sales tax on oil prices and Supreme Court decision of withdrawal of taxes on mobile phone cards. He informed that he had received a letter from the President of Financial Action Task Force in which he said that FATF platform should not be used for political speeches against Pakistan. However, Finance Minister was not satisfied with the reply of the FATF President.

Earlier, Finance Minister was chief guess at launching ceremony of regulations of Electronic Money Institutions (EMIs) organised by the State Bank of Pakistan (SBP). EMIs are non-bank entities that will be licensed by the SBP to issue e-money for the purpose of digital payments.

Addressing the meeting, the Finance Minister appreciated the launching of this new category of institutions which will complement the efforts of Government of Pakistan in creating an enabling environment to empower stakeholders in trade and commerce. This will help businesses in improving their productivity and contributing towards positioning the nation for global competition.

The Finance Minister said that the government was determined to transform the country into a knowledge-based economy by making IT one of the top contributors in Pakistan’s economy and job creation besides producing world-class knowledge workers in sync with international market trends. “It is our government’s policy to encourage the use of e-commerce amongst public through awareness campaigns to promote a culture of e-commerce in the country, which supports electronic business transactions at national, regional and international levels,” he elaborated. He also highlighted the importance of cyber security which is a growing threat for the financial institutions.

The Finance Minister termed the launching of electronic money institutions as a game changer for promoting e-commerce and digital economy in the country.

In his address, Deputy Governor SBP Jameel Ahmad shared the SBP’s initiatives in transforming itself into a modern, digital and fully technology oriented central bank. He briefly elaborated the strategy of SBP to embrace technology and innovation in digitizing banking & payments, and added that the launch of EMIs regulations was the first step of SBP’s strategy in that direction. “These landmark regulations are a testament of SBP’s commitment towards openness, adoption of technology and digitisation of our financial system,” added Ahmad. He acknowledged the commitment and full support of the stakeholders who provided extensive and valuable feedback by thoroughly reviewing the draft.

Ahmad recalled that SBP had issued the regulations for branchless banking about a decade ago that enabled the entry of telecommunication companies into the arena of banking and payments. “The prime objective of Branchless Banking was to enable the delivery of financial services using telco-based agent network,” he said adding, ”Over the past few years, branchless banking providers have evolved well and are now offering financial services to a large segment of our population”.