Once the government brings out the new automobile sector
policy, correcting the attitudes of car manufacturing companies, says federal
Finance Minister Shaukat Tarin.
He was talking in Samaa show Nadeem Malik Live.
Car makers, he said, would have to pay penalties if they did
not deliver automobiles in a timely manner.
He said that the government was eyeing how to curb import of
all luxury items, including cars, adding that it would help reduce the widening
Most car manufacturers, he said, just assembled cars, adding
that three such companies had formed a cartel, manipulating the entire market.
He said that the government would soon introduce seven new car makers in the
country to increase competition among manufacturers.
Global economy was hit by an economic downturn that had
lowered industrial output the world over.
According to Tareen, the inflation rate in Pakistan was
lowest in the world. He said that some countries were sustaining yearly
inflation levels of as high as 50% while the rate of inflation rate in Pakistan
was just 15% annually.
Maintaining that Pakistanis had to bear far greater
inflationary burden because their incomes had stagnated. He blamed the
International Monetary Fund (IMF) for this, saying that if incomes had
increased they could have sustained the resulting high prices.
Pointing out that the current rate of inflation in the
country was just 10%, he said that it was 18% last year.
Highlighting the government’s efforts to provide relief to
the common man, Shaukat Tarin said that various measures had been initiated in
According to him, the government had started providing low
cost wheat to flour mills, resulting in lowering of the price of the commodity.
A subsidy programme, costing Rs150 billion, was also being started to provide
essential food items at subsidized rates.
The government, he said, was working to reduce the profit of
the middleman in the agricultural sector, adding that it had also sanctioned
funds for building more grain silos and cold storage units.
Stressing the need to overcome line losses in the power
sector, he said that the problem of deficit in this sector and circular debt
would never end just by raising power tariff.
The government, he maintained, could not overcome deficit
until and unless it privatized all loss making insitutions.
Increase in imports created waves in the entire market,
propping up the dollar rates, he said. The government, he said, would also
overcome this problem too.
According to him, the value of rupee was unnecessarily
depressed and the foreign exchange rate should be determined in accordance with
real effective exchange rate.
Shaukat Tarin also said that the government was trying to
bring the real estate sector in tax net, adding that the government had also
identified 15 million unregistered persons and Nadra and FBR would be used to
get to them.
The quantum of business in the retail sector amounted to
Rs18 trillion, but trades amounting to just Rs3 trillion had been registered.
Manufacturers, he said, were paying due taxes, but tax
collection dwindled down the line. He said that the government would also have
to manage this problem.
Sales tax, he said, had been brought down from 17% to 10% to
effectively broaden the tax net.
High petroleum prices also triggered a cascading effect on
prices of almost everything, that was why the government did not intend to
bring domestic prices of petroleum products at par with international prices.
Shaukat Tarin also said that people would soon hear
good news regarding oil facility from Saudi Arabia, adding that it would help
reduce the national deficit by $2 billion.
Keeping the IMF in confidence on national economy was in the
best interest of the country and if it offered programmes in accordance with
our conditions it would benefit the country.
He also said that if ties with the United States improved,
there would be an easing in IMF conditionalities.
Highlighting the need for intelligently handling the
emerging situation in Afghanistan, he said that this could prove to be a boon
for the country.
Although Afghanistan lacked dollars, but it needed essential
commodities, he said, adding that if both countries opted to trade in Pakistani
rupee, it would be in the interest of both countries.
He said that the government was trying to stabilize the
government in Afghanistan, adding that Pakistan was consulting other countries
in the region in this regard.