ISLAMABAD     -    The federal government on Monday announced incentive packages worth of Rs360 billion for increasing the country exports and for Naya Pakistan Housing Program.

Adviser to Prime Minister on Finance and Revenue Abdul Hafeez Sheikh said that government has decided to allocate additional Rs30 billion as subsidy for Naya Pakistan Housing Program. This subsidy amount would help in new houses. Meanwhile, the government would give tax incentives to the businesses, which would involve in housing program, Shaikh said in a press conference along with Minister for Economic Affairs Hammad Azhar, Chairman FBR Shabbar Zaidi and Special Assistant to Prime Minister on Information Dr Firdous Ashiq Awan.

Adviser said that the government has decided to allocate Rs200 billion as subsidy for exporters. The government would give subsidy on higher interest rate. Meanwhile, the government has also decided to increase the share of loans given by State Bank of Pakistan is also being increased by Rs100 billion for exporters. Furthermore, Sheikh informed that the government has decided to cancel Sales Tax Refund Bonds immediately and the amount worth of Rs30 billion would be given in the form of cash to exporters to help increase their productivity. He explained that government wants to increase the exports of the country, which would help in employment opportunities. “The country will move towards prosperity when its exports increase,” he said and added that incumbent government is focusing on increasing exports.

Sheikh informed that International Monetary Fund (IMF) has allowed the government to give Rs250 billion to the electricity producers in order to retire the circular debt. Adviser was optimistic that government would surpass the economic growth during current fiscal year. Sharing the economic performance, he said that the government had reduced the trade and budget deficits in four months (July to October) of the ongoing financial year. Exports had started to show growth of 4 percent after five years. Tax collection has recorded growth of 16 percent in July to October period. Cement production has also increased, which showed that construction activities have started in the country, he added.

Adviser said that country’s foreign exchange reserves have increased by $1.2 billion to $8.4 billion in four months. Similarly, the government had paid $2.1 billion as against previous loans during four months. Meanwhile, the government had not made any borrowing from the State Bank of Pakistan in first four months of the current fiscal year. He said that IMF and World Bank had appreciated the economic performance of the government. The IMF would issue second tranche worth of $450 million after it showed satisfaction over the economic situation of the country.

He said exchange rate of the rupee is on stabilization and is gradually improving. The situation of the stock market is also satisfactory and index gradually increasing. The Adviser said a very good deal was struck with traders of the country in which they were given incentives and also urged to become part of the documentation drive. He said President of World Bank in his recent visit also hailed the reforms in FBR, SBP and power sector among other areas.

Replying to a question, Shaikh said talks between federation and provinces continue on NFC award. He said the share of FATA in the award is being determined after its merger with Khyber Pakhtunkhwa. However, the incumbent government had already allocated Rs152 billion for FATA, which is highest ever allocation for the region.

Responding to a question, he said the government is cognizant of the increase in prices of essential items and is working on various options to bring these down. He said grant of six billion rupees to Utility Stores Network will help bringing down prices of items of daily use. To another question, he aid reforms process in the State Owned Enterprises will be made while taking care of the rights of the employees working there.