Ramadan Approaches... Will Inflation Decrease? Advisor to the Finance Minister Khurram Shehzad

ARY NEWS

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00:00that this benefit should be transferred to the public in some way.

00:04But this is an intent.

00:05I am saying this because Ramzan is yet to come.

00:07Then the budget will come.

00:09Earlier people had hopes in the budget, now they are afraid.

00:13You are absolutely right.

00:14I am just completing this.

00:16The bleeding of the pension has been stopped.

00:19Along with that, the right sizing,

00:21that is, the federal government has a budget of $3 billion for the entire year.

00:24$3 billion.

00:25They are reducing it.

00:27There is an intent in this.

00:29They are reforming the SOEs.

00:30The SOE Act has come.

00:31According to that, they are aligning all the SOEs.

00:34There is an intent in that.

00:36Along with that, the management of debt has improved.

00:38That is why your fiscal deficit has improved.

00:40There is an intent in that.

00:41That is, the expenditure side.

00:42You remember, we used to talk about this.

00:44No one looks at the expenditure side.

00:45Everyone says that taxes should be imposed.

00:46Yes.

00:47So control the expenditure side as well.

00:48So that is being done.

00:49Because of this, a fiscal room should be made.

00:51If a fiscal room is made, then health, education can be spent on all these things.

00:55You can get more money in the morning.

00:56You can get more money in the morning.

00:57You can work on your third layer of democracy in the morning.

01:00I will talk about this in Ramzan.

01:03The ECC, which is supervised by the Finance Minister, heads this.

01:07A very good initiative has been taken in the ECC.

01:09Although this is the State Bank's prerogative.

01:12It is the State Bank's area.

01:13They control and manage inflation through monetary tools.

01:17This decision has been taken in the ECC.

01:19And not in every ECC.

01:20There are four ECCs in a month.

01:22So at least once a month, it is taken up.

01:24The numbers of inflation are visible.

01:26The numbers of inflation are visible.

01:28It has increased by 2.1% or 2.4%.

01:31So are the on-ground prices, vegetables, grains, chicken, have gone down or not?

01:37No.

01:38True.

01:39And if there is a gap in both, then it means that there is a middleman who is earning.

01:43And a common man is not getting any benefit from it.

01:45So the ECC will take action on that.

01:47To make sure that the prices are on-ground.

01:50And the paper is also visible.

01:52Paper versus ground.

01:53One thing is very important.

01:54In our country, the definition that was given, that inflation has gone down.

01:58Look at the prices of tomatoes.

02:00It has crashed.

02:01It is very good.

02:02It is very negative.

02:03We say that the farmers should not be harmed and the consumers should not be harmed.

02:06But I am saying one thing.

02:08In our country, people get confused on the definitions.

02:12Often people are commenting that inflation has not gone down.

02:15The rate of increase in inflation is less.

02:20But in our country, there are two issues.

02:23One is inflation.

02:24And the second is that there is no price control mechanism.

02:27That is, there are no elements in the market that can check them.

02:30That we are taking out the rate list, so we are getting it according to that.

02:33You said that the ECC will do it.

02:35But what will be its mechanism?

02:36Look, I will tell you that we have talked about this before.

02:39The price control mechanisms work to a certain extent.

02:43You have to do two things for sustainability.

02:46You have to improve the supply.

02:48You have to ensure the supply in the market.

02:50You know that the demand supply works.

02:52So when the supply increases, naturally no one can manipulate the price.

02:58When the tomato supply increases, the onion supply increases, the wheat supply increases.

03:02So the government or whoever is responsible for this has to improve the supply.

03:07The second thing I will say is that when there is devolution, it is the work of the provinces.

03:10Looking at the markets, structuring the markets, all this is the work of the provinces.

03:14And then below, why don't you create a third layer of democracy?

03:17That should be done.

03:18Okay, tell me one thing.

03:19Right now, there is a risk of drought.

03:22Alhamdulillah, it rained.

03:23But apart from that, there is a risk of drought.

03:25And it is being said that our food security can be greatly affected.

03:30Keeping this in mind, what arrangements are being made?

03:33Because you know about global warming, that there is an impact of climate change on this too.

03:37There has been a very big development with the World Bank.

03:40The World Bank has signed a country partnership framework with Pakistan, long term.

03:44And that is a funding of $20 billion for the next 10 years.

03:47Along with this, the IFC has a further $20 billion.

03:50You must have seen what I said in the beginning.

03:52The global chief of IMF has also tweeted that we will bridge $2 billion as private investment.

03:59Okay.

04:00Within that, there are 3-4 critical areas.

04:02In fact, there are 6 areas.

04:03The country partnership framework of the World Bank.

04:06This is the first country that Pakistan has signed with.

04:08In that, there is long term financing on poverty alleviation.

04:11Okay.

04:12There is financing on children's schooling.

04:13There is financing on your health.

04:15There is financing on climate change and climate challenges.

04:19And there is private investment.

04:20Okay.

04:21So, look, all these things are being covered.

04:22Now, what is our job?

04:23Look, the world is standing with you.

04:25The IMF has given you a program.

04:26It is a hard-earned program.

04:27Of course, it is not that easy.

04:28After the SBA, this happened.

04:29I know.

04:30Then the World Bank is coming with you.

04:31The ADB is coming with you.

04:32The IFC is coming with you.

04:33The world's big...

04:34They are not just funding.

04:35We say that we are giving funding, money and loans.

04:38Look, there are soft loans.

04:39Yes.

04:40They are at a low rate.

04:41I am telling you seriously.

04:42The short-term financing is expensive.

04:45It is expensive.

04:46True.

04:47You get a long-term project and program funding at a low rate.

04:49They are not just giving you money.

04:50Okay.

04:51They are giving you technical support.

04:52So, these things will be covered.

04:53Okay.

04:54But it will take time.

04:55I have one thing.

04:56It is a very important question for everyone.

04:57Till now, the increase that is said to be suppressed is of the salaried class.

05:04Yes.

05:05That is, on the issue of taxation, on the other hand, we have been seeing and

05:07we have been discussing with you that the Tajir Dost scheme.

05:09Somehow, give a tax of 100 rupees.

05:11And we know and you also know that in the multiple areas of Karachi,

05:14the business that is taking place in such a small shop is of a magnitude higher than our salaries.

05:18Absolutely.

05:19And there is no check-in balance.

05:20Yes.

05:21So, how will this surge from the salaried class fall on them and how will it transfer to other places?

05:26Look, the first thing I will tell you...

05:27Or is there any possibility of relief this time?

05:29Yes, I will tell you that a lot of realization has come.

05:34And it is that we cannot do more than what we have already put a burden on.

05:39And this is a very good thing that now we have to go for an alternative.

05:44Although it should have been done a long time ago, but it is getting better.

05:47So, now you have increased from three areas.

05:50And I will tell you that a very important development has taken place.

05:52That has happened on the agriculture tax.

05:53You see, all four provinces have approved the legal framework of Labbaik.

06:00Okay.

06:01So, there is also KPK in it.

06:03Punjab did it, KPK did it, Sindh did it, Balochistan did it.

06:06But this is a very big development.

06:07It is historic.

06:08I think we are not able to tell it in that way.

06:10This is a very big development that the agriculture tax has been implemented.

06:14Okay.

06:15Secondly, retail, wholesale and trade.

06:17There is 19% of GDP and 1%...

06:19Let me tell you, agriculture and retail, these two together make up 45% of GDP and give only 1-2% tax.

06:26The remaining 55% of GDP gives 98% tax.

06:30We are going to fix this.

06:31We have held very good meetings on retail, wholesale and trade.

06:34You will see in the coming months, Inshallah, how we will bring them.

06:37Let's hope so.

06:38I have told you about the agriculture tax.

06:40Then how to rationalize the real estate.

06:42Okay.

06:43So that the activity does not get hurt.

06:44The economy continues to run.

06:45The tax comes from the right place.

06:46And a fair economy.

06:47Let's hope for the best.

06:48Thank you so much for your time, Farham Shahzad.

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