ISLAMABAD - Islamabad Chamber of Commerce and Industry on Friday said that government should continue its efforts to maintain financial discipline instead of hefty borrowing from State Bank of Pakistan (SBP) that already went up during the first seven months of the ongoing financial year.
ICCI President stated that meeting the budgetary targets of ongoing fiscal year through continuous borrowing from SBP and other commercial banks was not the suitable option for sustaining macroeconomic stability in long run. Thus, Government should regulate its public spending and pursue a sound fiscal policy that could also help in reducing current account deficit, he maintained.
He was responding to reports that government has borrowed Rs.195.22 billion from the SBP for the budgetary support during the seven months of fiscal year 2011-12, adding that Government should initiate comprehensive fiscal reforms and widen tax base to curtail borrowing from central bank.
Our country could reap the benefits of economic growth, investment and exchange rate stability and foreign exchange reserves by controlling non-development expenditures and maintaining financial discipline, Yassar Sakhi Butt said. ICCI President said that Pakistan was confronted with challenges like huge budget deficit, rising debt-servicing, uncontrollable debt burden, declining investment and rising unemployment.
He was of the view that every political party in our present democratic set up should work jointly for improving country’s economic uplift rather than making huge unnecessary expenditures that rendered heavy dents on our fragile economic system.
Yassar Sakhi Butt urged the Government to spend borrowed money on capital projects, which provide a platform for jobs creation through generation of economic activity. In order to make public sector spending more effective, public spending policy must have priority for removing infrastructure obstruction, he maintained.