ISLAMABAD   -   Abdul Hafiz Sheikh, Advisor to Prime Minister on finance, has said price hike is a problem in the country and government is worried over it.

Dr Abdul Hafeez Shaikh said that controlling petroleum products’ prices is not in incumbent government’s hands.

Addressing a ceremony, the advisor said agreement with IMF will send a positive signal to other international financial institutions as well as countries regarding Pakistan’s commitment to fiscal discipline.

Upcoming budget will contain steps to address gaps in current account deficit and fiscal deficit for attaining sustainable economic growth, he assured.

He said the government’s measures have resulted in reduction in imports and increase in exports and remittances.

Hafeez Sheikh said steps have also been taken to decrease expenditures, and coordinated efforts are underway to increase revenue.

Dr Abdul Hafeez Shaikh said that the upcoming budget for the fiscal year 2019-10 would focus on bringing about macroeconomic stability in the country, besides introducing measures for welfare of vulnerable segments of the society, as highlighted in ruling party’s manifesto.

Addressing an Investment Conference here, the advisor said that the budget would comprise measures to address issues of fiscal and monetary policies for promoting sustainable growth.

He said that the government was committed to fiscal discipline, improving macroeconomic policies and engaging with the rest of the world. He added that it was not in the hands of the government to control the prices of oil and other things that are internationally determined.

“So what we need to do is to figure out a combination of monetary and fiscal policies to curtail aggregate demand to reduce imports particularly luxury items, amake them harder to import and minimize the impact on the lives of ordinary people because this hurts public and it hurts everybody,” the minister remarked.

Terming the inflation as a bad tax, the advisor said government was trying to manage this threat. “As we go forward, we have to find more resources to alleviate suffering and reach out those who are left behind in our society,” he added.

He said that there would be an enhancement in social safety programmes, which have been integrated under the umbrella of Ehsas programme.

He, however, was of the view that a smart thinking and utilization of modern technology was required to ensure that the money goes into the hands of right people.

The advisor also highlighted the importance of privatization to realize the full potential of companies under public control, saying that if these were not managed by bureaucracy, then there was need to find a way forward.

He said that between the calendar year 2003 and 2006, around 34 companies  were privatized in electricity, telecommunications, big banks like Habib Bank, United Bank, adding that these earned around $4 to 5 billion for national exchequer within three years.

He, however lamented that since early 2006 or last 13 years, not a single company was privatized.

On negotiations with International Monetary Fund (IMF), the advisor said that the fund exists as an international institution helping economies that face macroeconomic imbalances.

He said that the government was in negotiations with the fund and obviously it would ensure that a reasonable programme is reached which would create a platform for sustainable macroeconomic stability. The programme would also ensure enhancing relationship with international players such World Bank, Asian Development Bank, Islamic Development Bank and country’s bilateral friends and so on.