ISLAMABAD - The Economic Advisory Council (EAD) on Saturday fully endorsed Finance Minister Ishaq Dar’s long-standing proposal for signing a Charter of Economy by all political parties in the country. It also showed reservations on some of the economic policies of the incumbent government, especially its role in fixing support prices of food commodities and borrowing from commercial banks, but appreciated the overall performance of the government on economic front.

Sources informed that members of the EAD asked the government not to fix the support prices of food commodities like wheat and sugarcane through market mechanism. Similarly, they also showed concerns over the government’s borrowing from commercial banks.

The sources further informed that one of the members of expressed reservations over the expected deflation in the country, following the sharp decline in inflation rate. The EAD met under the chair of Finance Minister Ishaq Dar.

The sources said that the government took the Council on board regarding imposition of new taxes to achieve the downward revenue collection target of Rs2691 billion by end of June 30, 2015.

“Yes one or two members of the Council raised some concerns on some issues during the meeting, which was addressed by the government,” said Finance Minister Ishaq Dar in an exclusive talk with The Nation. He informed that members however appreciated the government’s overall fiscal policy as reserves have increased to $16 billion.

Dar also dismissed the chances of expected deflation in the country. “The government is currently working to restrict budget deficit at below 4.9 percent of the GDP during ongoing financial year 2014-2015 and we are well on track in the first half,” he held.

According to an official handout, the EAC in its 5th meeting fully endorsed Finance Minister Ishaq Dar’s long-standing proposal for signing a Charter of Economy by all political parties in the country. Participants of the meeting agreed that economic development of the country should be above all other considerations and remain so irrespective of the change of regimes. The meeting also expresses consensus on continued economic reforms.

The finance minister at the outset of the meeting welcomed the participants and gave a brief overview on current economic profile of the country particularly highlighting developments related to the successful review of the IMF programme concluded recently and updates on the government’s privatisation programme.

He said that the pre-budget recommendations of the last EAC meeting had been made part of Federal Budget 2014-15, and their implementation was being actively pursued. He apprised the meeting that the government has consistently followed-up with all ministries to ensure their timely implementation of EAC recommendations.

Finance Secretary Dr Waqar Masood gave a presentation on the economic situation and shared recent growth figures for different sectors of the economy.

FBE Chairman Tariq Bajwa briefed the meeting about the latest position with regard to tax collection and additional taxation measures being undertaken. He also apprised the meeting about the reform measures being carried out by FBR to broaden the tax base and improve tax administration. Prominent economist Dr Ashfaq H Khan on this occasion suggested for improvement in e-filing of returns with the FBR. He said improvement in this regard would facilitate the tax payers.

The finance minister invited Dr Sania Nishter to dilate on the findings of the Task Force on Social Safety Nets that had earlier been formed under the Social Sector Sub-Group of the EAC. Dr Sania stated that the task force would be submitting its final report within a month and highlighted the important findings that had emerged from the task force’s deliberations to date. The task force had been mandated to examine the existing social protection framework in the country and come with recommendations for improving targeting, efficiency and eliminating duplication and overlapping between different programs.

Mr Farooq Rehmatullah from the Energy sub-group shared important results from some of the analytical work undertaken on the growth potential of the aviation sector in Pakistan and the preparation of an Integrated Energy Plan. The finance minister highlighted the initiatives undertaken by the government to eliminate the energy side bottlenecks and informed that 7,000MW of new generation capacity would be added to the national grid till 2018.