Ep13june2013

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Rs3.591 trn deficit Federal Budget Budget focusses on economic growth No increase in salary of govt employees Pensions increased by 10 pc GST raised from 16 to 17 pc Fiscal deficit 8.8 pc GDP growth rate projected at 4.4 pc Inflation 9.5 pc Defence allocation Rs 627b Rs 75b for income support programme Rs 185b power subsidy STAFF REPORTER

NEPRA ups power tariff by 74 paisa ISLAMABAD—The National Electric Power Regulatory Authority (Nepra) has notified an increase in electricity tariff by 74 paisa per unit for all distribution companies of Wapda. A notification was issued Wednesday which will be applicable across the country except Karachi. Through a series of orders, the regulator notified tariff adjustments under the monthly fuel mechanism for the month of April. However‚ the consumers will pay the amount in the bill for the month of November.— INP

Qarz-e-Hasna, new laptop scheme planned ISLAMABAD—The Finance Minister Ishaq Dar Wednesday said it has been decided to launch a new scheme to provide laptops to the students pursuing degree program from one of the HEC recognized universities or institution. Ishaq Dar said the scheme for reimbursement of tuition fee at Masters and doctorate levels which is available for the students of Balochistan‚ FATA and Gilgit Baltistan is being expanded to Interior Sindh‚ Multan‚ Bahawalpur and D. G Khan division which are equally less developed. He said it has been decided to allocate five billion rupees to launch a scheme of “Qarz-eHasna” so that young people could establish their own businesses. Fifty percent of the beneficiaries of this scheme will be women. Continued on Page 6

IG Motorways removed over congratulatory ad ISLAMABAD—The government on Wednesday removed Inspector General Motorways for issuing congratulatory advertisement on state expenses. The Prime Minister Mian Muhammad Nawaz Sharif has already barred ministries and autonomous bodies from issuing such advertisements. Few days back, the government had issued showcase notices to President National Bank of Pakistan (NBP) and IG Motorway Zafar Abbas over congratulatory advertisements on Nawaz Sharif’s election as PM. However, on Wednesday, the IG was formally removed from his office and ordered him to report the Establishment Division. The PM has warned of strict action against those violating these directions, saying that the head of the department concerned would have to pay the amount spent on such advertisements. —INP

ISLAMABAD—The Federal Finance Minister Ishaq Dar on Wednesday unveiled Rs 3.591 trillion Federal Budget 2013-14 focusing on economic growth, resolving energy crisis, reducing fiscal deficit and tackling public debt for putting economy back on track.

he said, had not looked after the national interests. The Minister better accountability by reject- past five years. He said that GDP economy in accordance with the said that the nation has made ing those who did not deliver in growth remained below 3 percent and if compared with the population growth of about two percent, the real growth would stand at just one percent. He said that inflation has remained at 13 percent which is highest during the past 4 decades while the foreign exchange reserves have fallen from $11.1 billion to $6.3 billion. He said that the newlyelected government would fulfill all its promises it had made during the election campaign, saying that the budget for fiscal year 2013-14 was the manifestation of the same pledges. He introduced Economic Vision that would lead the country towards sustainable economic growth. Finance Minister during his speech did not announced any increase in salary of government employees

Federal Finance Minister Ishaq Dar while delivering budget speech at the National Assembly here also announced improvement in tax collections and reduction in non-development expenditures. “We are starting our journey from very precarious situation, however the bad condition of economy has boosted our courage to lead it towards its desired heights of sustainability,” he ISLAMABAD: Prime Minister Muhammad Nawaz Sharif signing the budget documents ISLAMABAD—The trade deficit said. narrowed down to $12.5 billion The previous government, for the year 2013-14. in July-April 2012-13 as against about $ 12.9 billion over the corresponding period of last year. According to the Annual Out of the total amount Rs However, during the fiscal ISLAMABAD—The government Plan 2012-13, decline in trade has allocated Rs 45.8 billion for 45.841 million, the government year of 2012-2013 the governdeficit by 2.5 percent is due to development of less developed has allocated an amount of Rs ment had allocated an amount of higher growth in exports as areas particularly in the field of 44,057 million for special areas Rs 34,211 million which include compared to imports. and Rs 1784 million for narcotRs 16,000 million for Federally ISLAMABAD —The governinfrastructure development and The document further rehuman development for the year ics control division and interior Administrated Tribal Areas, Rs ment has earmarked Rs veals that export(gross) during division. 7137 million for Gilgit-Baltistan 295,518 million for 41 federal July- April of 2012-13 stood at 2013-14. A total amount of Rs 18,500 while Rs 9547 million for Azad ministries / divisions in the $20.5 billion against $20.5 bilAccording to the Annual Plan 2013-2014,the federal gov- million has been allocated for Jammu and Kashmir and Rs 507 PSDP for the year 2013-14. ernment in fiscal year 2013-14 Federally Administrated Tribal million for other projects in the  According to highlights of the Public Sector Developwould provide fundamental ne- Areas and Rs 8200 million for special areas. In the last fiscal year the ment Programme (PSDP), cessities of the life to the inhab- Gilgit-Baltistan while Rs 10,500 itants and make these regions million for Azad Jammu and government had allocated an the Defence Division has economically active to bring Kashmir and Rs 6857 million amount of Rs 831 million for in- been allocated Rs 3,545.5 sustainability and self-depen- for other projects in the special terior division and Rs 189 mil- million as compared to Rs areas. lion for narcotics division.—APP 1,238.1 million last year. dency.  Likewise, the Water and Power Division (Water Sec- ISLAMABAD—Federal Finance tor) has been allocated Rs Minister Ishaque Dar Wednesday 57,840.2 million, the Cabinet said energy crisis has badly afDivision Rs 2,179.8 million, fected life of common man and the Capital Administration & economy. ISLAMABAD—The following are the salient features of the Development Division federal budget presented on Wednesday. Presenting the budget before (CADD) Rs 1,505.7 million house‚ Finance Minister Ishaq  Minimum pension raised from Rs 3000 to Rs 5000  PM house expenditure to be decreased by up to 44 ISLAMABAD—The balance of and the Commerce Division Dar said that the government has percent: Dar decided to launch new hydel‚ payments will remain under pres- Rs 841 million.  VIPs will not be allowed to import vehicles without sure due to external debt repay-  Rs 109.3 million has been nuclear and coal power projects paying duty and taxes ments including payments to earmarked for the Commu- besides shifting the hydel  All organizations and autonomous bodies have asked IMF and weak financial inflows. nication Division (other than projects on coal. to freeze secret funds He said measures will also Allowing for other capital NHA) and Rs 2,300 million  Micro-finance scheme to be launched for youths and inflows, the Annual Plan 2012- for the Defence Production be taken to reduce line losses and mark-up loans will be provided to them improve transmission system 13 reveals that the overall bal- Division.  Youths below the age of 25 and holding a masters degree ance is likely to be in deficit by  The Economic Affairs which will help overcome energy will receive a stipend of 10,000 per month during a one $0.5 billion in 2013-14 com- Division has been allocated crisis. year training program. PM Youth Skill development pared to an estimated deficit of Rs 104.5 million while the program will be launched $1.8 billion in 2012-13. Gross Education and Training Di Hybrid cars up to 1200cc will not have any duty, sales reserves of SBP are likely to be vision has been given Rs tax or income tax. Duty on Hybrid Vehicles 1200 to around $1.3 billion in 2013-14 5,237.1 million. 1800 to be reduced by 25 percent compared to a level of $ 4.7 bil-  The Establishment Division has been allocated Rs  Sales tax to be increased from 16 to 17 percent: Dar lion estimated for 2012-13.  Commercial and industrial electricity account holders Similarly, on account of 79.4 million and the Federal will be charged an additional five percent sales tax if improvement in energy supply Tax Ombudsman Rs 31.3 they are not registered tax payers. When they are and in the security situation, ex- million. STAFF REPORTERS registered this increase will be withdrawn ports for 2013-14 are projected  The Finance Division  Nominal levy of 0.5 percent should be imposed to to grow by 5.1 percent to $26.6 has been given Rs 13074.2 ISLAMABAD/KARACHI—Govmovable assets of wealth persons to support income billion from $25.3 billion esti- million while the Foreign Af- ernment employees have ansupport fund mated for 2012- 13. While im- fairs Division has been ear- nounced a strike on June 21 after their salaries were not increased  Merchant and traders tax rate to be set at 25 percent ports during 2013-14 are pro- marked Rs255.2 million.  New adjustable withholding tax on foreign films and jected to increase by 7.0 percent,  The Higher Education in the Federal Budget 2013-2014. For the first time in the hisdramas hence the trade amount is pro- Commission (HEC) has been tory of the country no increase jected to be in deficit by $16.7 Continued on Page 6 Continued on Page 6 has been made in the salaries of billion in 2013-14.—APP

which is first time in the history of the country that government employees salary has not been increased in the budget, but taking a lenient view of pensioners

ten per cent increase in pension was announced. Further, the minimum pension of an employee has been enhanced to Rs

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No new tax ISLAMABAD—Referring to tax He said capacity of tax machinproposals in the National Assembly Wednesday‚ the Finance Minister Ishaque Dar said being a nation we will have to take decisions to help make Pakistan self-reliant through off-loading debt and concentration of national economic priorities. He said the government has decided to not to impose any new tax on those who are already paying their share of tax. However‚ those who are not paying tax will be brought into tax net and for this purpose new tax reforms will be introduced.

ery will be enhanced by making tax system easy and expand its scope. Steps will also be taken to overcome corruption and facilitate tax payers. Ishaque Dar said it has been proposed in the next budget to decrease corporate tax by one percent each year and bring it to 30 percent in the next five years from the existing thirty-five percent. He said tax exemption in special economic zones will be extended upto 10 years. He said two percent adjustable withhold-

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Trade deficit shrinks by 2.5pc

Rs 45.8b for special areas uplift

Salient features

Allocations for 41 ministries, divisions

lion in the corresponding period of the previous year, showing no increase. While imports during the same period decreased by 0.9 percent to $33.04 billion over the corresponding period of the last year which was $33.3 billion. Thus, the import bill is low due to decrease import bill from food, transport, petroleum, agriculture and other chemicals group. Similarly, the workers’ re-

mittances have continuously witnessed a increasing trend during the last year few years and during July-April 2012-13 it reached a level of $11.6 billion as against $10.9 billion in the corresponding period of the last year, registering an increase of 6.4 percent. Monthly average remittances during this period stood at $1.16 billion as compared to $1.09 billion during the same period of previous year.—APP

Energy crisis badly affect common man, economy

No discretionary funds of ministers

PR to be made independent corp

I SLAMABAD —The federal

Balance of payments likely to mount pressure

He said to give a boost to economic activities it has been decided to expand road network and link it to Gwadar port. He said work on three sections of Motorway including FaisalabadKhanewal‚ Karachi-Hyderabad and Gwadar-Ratodero will be expedited. He said the Motorway network will be completed by the government in its tenure which will help give new dimension to the economic growth. He said the Prime Minister has established initial contact with China for construction of a

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cabinet on Wednesday decided in principle to abolish the annual discretionary funds of the federal ministers. Decision to this effect was taken in a meeting of the federal cabinet headed by Prime Minister Mian Nawaz Sharif to approve the annual budget for the financial year 2013-14, official sources said. According to sources, all the federal ministers used to get Rs600,000 annually as discretionary funds, but now these funds have been abolished. The sources said this practice will save Rs20 million for

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Budget disappoints Govt employees, to observe strike on June 21

A balanced budget: Businessmen AMANULLAH KHAN KARACHI—Under the prevailing tough economic conditions, the federal budget presented by finance minister Ishaque Dar, was generally described as a Balanced Budget, by the senior business houses and trade and industry leaders assembled at at various trade bodies offices to listen the first budget of the newly elected government, here today. The President Federation of Pakistan Chambers of Commerce and Industry (FPCCI)

Zubair Ahmed Malik said that the business community is figuring out the impact of the government’s decision to raise sales tax from 16 per cent to 17 per cent and it is inevitable that increasing sales tax across the board will adversely affect the common man. He welcomed the reduction in corporate tax rate from35 to 30 per cent. He said that FPCCI has demanded in its budget proposals to eliminate SRO culture and government’s intention in this regard is encouraging. He

said that government has announced various big allocations in the budget but did not explain how this money would be generated. He said that some measures announced in the budget speech are welcome steps and if the austerity drive at PM House and other government departments would be implemented the FPCCI would not only welcome it but extend its full support to the government. He said that allocations for higher education, Qarz-e-Hasna Scheme, increase

in pensions and similar announcements are welcome steps but slapping Rs400 per tonne customs duty on canola seed would increase the prices of edible oils. Former President FPCCI and Vice President Confederation of Asia Pacific Chambers of Commerce and Industry, Tariq Sayeed while talking to media said that the budget is quite ambitious but the revenue generation is not clearly mentioned in the budget speech. He said that reducing the tax on corporate sector is a welcome step.

government employees. Government employees did receive a ten percent increase in their pensions in the budget. The minimum pension was also increased from Rs3,000 to Rs5,000 in the budget. Meanwhile, sources privy to the cabinet meeting which approved the fiscal budget on

Wednesday say that the federal cabinet was undecided over the matter of increasing government employees’ salaries. Sources further said that despite being in a struggling fiscal situation, authorities were considering an increase in the salaries of federal government em-

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Budget not a people-friendly: Oppo Increase in Sales Tax rejected STAFF REPORTER ISLAMABAD—Shortly after the budget was presented, members of the opposition in the assembly spoke to media outside the National Assembly to give their reactions. Muttahida Qaumi Movement MNA Farooq Sattar said that as per tradition no lasting solution to the country’s economic woes had been presented. Sattar, whose party won a

majority of seats from the financial hub of Pakistan, said that after the 18th Amendment, most of the constitutional subjects have been devolved to the provinces. In light of this, the federal budget should have been reduced. “It means that as per tradition only a symptomatic treatment has been done, a permament solution has not been proposed.” Sattar also criticised the new government’s plan to

increase sales tax by one per cent. “Sales tax should have been reduced from 16% to 10%, instead, it was increased to 17%.” This, Sattar said, would only further burden the poor. “An increase of one per cent in sales tax will be an increase of five per cent in inflation.” He said that sales tax was an indirect tax that is paid directly by the people while the feudalists and landown-

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