7,000MW to be added to national grid by 2017, IMF assured

The assurance was conveyed by Prime Minister Nawaz Sharif and Finance Minister Ishaq Dar to IMF mission.—AFP/File
The assurance was conveyed by Prime Minister Nawaz Sharif and Finance Minister Ishaq Dar to IMF mission.—AFP/File

ISLAMABAD: The government assured the International Monetary Fund on Monday that 7,000MW of electricity would be added to the national grid by 2017 and tax base expanded for generating more revenue to support development and social sectors.

The assurance was conveyed by Prime Minister Nawaz Sharif and Finance Minister Ishaq Dar in back-to-back meetings with the newly-appointed IMF mission led by Herald Finger currently on an introductory visit to Pakistan.

The IMF delegation comprised Harald Finger, IMF Mission Chief to Pakistan, Tokhir Mirzoev, Resident Representative of IMF to Pakistan and Masood Ahmad, Director Middle East & Central Asia Department. It was the first official visit to Pakistan by Mr Finger and Mr Mirzoev after recent shake-up in IMF staff for Islamabad.

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Prime Minister Sharif welcomed and congratulated Mr Finger and Mr Mirzoev on their new assignments. He acknowledged the financing of $6.64 billion from the IMF to support Pakistan under the Extended Fund Facility (EFF) approved by the IMF Board in September 2013.

He said his government was taking measures for increasing tax base in the country to generate more revenue for spending on development and social sectors.

An official statement quoted the visiting delegation appreciating the positive economic indicators in Pakistan. The IMF mission congratulated the prime minister and his team on the rise in foreign exchange reserves, reduction in budget deficit and an increase in GDP, showing restoration of economic stability and hence it was high time for Pakistan be part of the group of dynamic emerging markets.

The assurance was conveyed by Prime Minister Nawaz Sharif and Finance Minister Ishaq Dar to IMF mission

Mr Finger is reported to have said that he was impressed by the economic headway Pakistan had achieved in the past months and hoped that things would further improve in the next three years.

The official statement quoted IMF Director Masood Ahmed as saying that Pakistan’s economy presented a totally different picture now compared to what it was 18 months ago. There was comparative economic stability and this could serve as a good foundation to further build up the economy in future, truly turning Pakistan into an emerging economy.

He emphasised focus on broadening the tax base, improving investment regime and enhancing competitiveness of the economy.

Finance Minister Ishaq Dar said Pakistan had met all structural benchmarks and quantitative performance criteria set for the sixth review. He also mentioned the problems that the government had inherited in the form of energy shortages, a weakened economy and scourge of extremism.

He said a number of power projects had been undertaken and 4,000MW projects were already ensured to be added to the national grid soon which would ultimately reach 7,000MW by 2017. Further, the Chinese side had also undertaken to set up power plants on government-to-government basis which could produce up to 10,000MW of electricity.

Mr Dar said Pakistan had incurred over $100bn in economic losses because of terrorism and suffered 50,000 casualties, including 5,000 military personnel, in the war on terror. He said the government had pursued the path of dialogue to resolve the issue of militancy, but finally it had to resort to a full-fledged military action.

He said the Zarb-i-Azb Operation was laun­ched with vigour which had yielded results as high-profile targets had been eliminated. “We have shared details with the donors at three conferences held over the past few months aimed at drawing up plans for rehabilitation of IDPs and people affected by floods.”

The finance minister said the government had extended due care to social protection measures. The present government had enhanced the number of recipients to 4.8 million under the income support programme and aimed to achieve target of 5m beneficiaries by the end of June this year. The government had declared the National ID card number as the National Tax Number to facilitate individual taxpayers, he added.

He claimed to have passed on to consumers the full benefit of decrease in oil prices and against all forecasts, did not enhance the prices for March and instead made adjustments in GST to keep the prices level.