Hopes political dialogue with opposition parties in parliament will result in best economic interest of Pakistan
ISLAMABAD: IMF Resident Chief Tokhir Mirzoev says advancing the PIA privatisation requires political dialogue and evolving consensus within Parliament after the preparatory work done by the government.
“It is not the IMF but Parliament will have to decide to continue burdening the national exchequer with loss making entities or to go ahead with the privatization plan of PIA, Pakistan Steel Mills and power distribution companies.
We hope the political dialogue with opposition parties in Parliament will result in best economic interest of Pakistan,” he said while talking to a select group of reporters here on Friday. Just ahead of holding next round of 10th review talks scheduled to be held at Dubai from January 26 to Feb 4 under $6.64 billion Extended Fund Facility (EFF) with the Pakistan team led by Finance Minister Ishaq Dar, the IMF chief said easy transactions under privatization plan had already been done and a stage came where difficult transactions like the PIA, PSM and power distribution companies (DISCOs) would be accomplished as remaining big ticket items on the list of reform agenda.
After getting approval of PIA amendment bill from the National Assembly, he said now the Senate would take up this bill where the opposition possessed significant presence and continuation of dialogue means that efforts were underway to evolve consensus.
To a query regarding blocking the way of smooth passage by the Upper House of Parliament regarding PIA bill, he said the IMF did not necessarily agree to viewpoint of all institutions.
When asked again that the last program during the PPP regime was suspended because of inability of government to pass Reform GST bill from Parliament and what will happen in case of failure of passing PIA bill before ending the existing program, he said it would be premature to predict the outcome of continuous dialogue process which will now be debated in the Senate.
“The credit goes to the government that it pursued the PIA privatization and now the stage of evolving consensus in Parliament has reached,” he added. Within Parliament, he said efforts were underway to address the concerns of opposition parties.
The IMF, he said, did not take stance that how privatization of particular entity and structure of privatization was finalized but keeping in view the polarized situation the government was trying to address fiscal and competitiveness concerns with regard to the loss-making entities.
“The continuation of reform process is not an easy one,” he said and added that with the IMF program or no IMF program the reform path should continue. Regarding tax amnesty scheme approved by Parliament, he said the overall objective was broadening of tax base where the government introduced tax amnesty scheme which was quite different from the past schemes as if someone would prefer to remain outside the tax net he would have to pay extra tax on financial transactions.
“The cost for non filers will go up,” he said and added that the upcoming review talks with Pakistani authorities would focus on getting further details and projection of its success from next week at Dubai.
To another question regarding outcome of existing three-year IMF program, he said the duration of Fund program was long enough to roll out reform process but it’s important that the reform process should not stop after achieving successes.
He said autonomy to the SBP, removal of tax exemptions, going after non filers and fixing energy bottlenecks were major achievements of the existing IMF program and there was need to improve business climate in Pakistan.
The business climate can be improved through increasing exports as its worrying development that the exports were not up to the mark. The China-Pakistan Economic Corridor (CPEC), he said, was going to help improve growth momentum. The benami transaction bill and merger of CNIC with NTN were big ticket items, he said and added that the stocks of GST refunds were reduced to Rs113 billion till November 2015.
