Economic experts deplore absence of innovative approach and out-of-the-box thinking in federal budget 2020-21.

ISLAMABAD -- The declining state of governance affairs has been evident from the government's tackling of Covid-19 whereas the recent crises of petrol, wheat and sugar has exposed its deficiencies even further. The present budget was an opportunity in the wake of the pandemic to address the country's chronic problems, but the non-innovative routine exercised by the government has failed to pacify even much-curtailed expectations.

The thoughts were unanimously reflected by economic experts partaking in a webinar titled 'Federal Budget 2020-21: My Impression and Takeaways' which was organized by Institute of Policy Studies (IPS), Islamabad. The online event, which was chaired by Executive President IPS Khalid Rahman, was addressed by Zafar-ul-Hassan Almas, Chief Macroeconomics, Planning Commission of Pakistan, Dr. Atiquzzafar Khan, acting director general, International Institute of Islamic Economics (IIIE), Dr. Anwar Shah, assistant professor, Quaid-i-Azam University, Islamabad, Zaheeruddin Dar, executive consultant and expert, Center for the Promotion of Imports from Developing Countries, Mirza Hamid Hasan, former secretary, Water and Power, Amanullah Khan, former president, Rawalpindi Chambers of Commerce and Industries, and Senior Research Fellows at IPS Ambassador (retd) Tajammul Altaf and Syed Muhammad Ali.

Shedding light on the financial constraints faced by the government in managing its businesses, Almas said that the federal government's revenue - after paying the due share of provinces - was around 3.7 billion, which is not even enough to pay interests and principal amounts of loans, and hence, the government will start its business with a deficit of Rs 1 trillion. In addition, he said, the provinces, despite having autonomous powers of managing most of their issues post 18th amendment and getting major share of revenues from federal collections, still look towards the federal government in dealing with the calamities like pandemic.

He said that the exports at present were showing a very grim situation and remittances too were declining due to the pandemic. The bankruptcy of various small entities due to the outbreak of pandemic also needed immediate intervention of the government. One of the positive developments however compared to the previous year was a significant increase in FDI (Foreign Direct Investment), whereas the declining trends in inflation and low policy rate may also provide some relief to the public, he stated.

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