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Finance minister reviews five-year macroeconomic framework

ISLAMABAD: Finance Minister Ishaq Dar on Tuesday said the government is focused on improving key macroeconomic indicators, including the investment-to-GDP and tax-to-GDP ratios.

He was chairing a meeting to review the five-year (2017-22) macroeconomic framework.

The finance minister gave instructions to align the medium-term fiscal policy with the targets provided in the amended Fiscal Responsibility and Debt Limitations (FRDL) Act.

Dar underlined the importance of recent amendments in the FRDL Act, which has assisted in limiting the deficit of the federal government.

The FRDL Act requires the federal government to decrease its deficit in three years, starting with 2017-18, to 4 per cent of the GDP, and thereafter maintaining it at a maximum of 3.5pc.

Dar reiterated the government’s resolve to continue on the path of economic reforms which were drafted at the beginning of 2013-14.

He also said that the FRDL requires the debt-to-GDP ratio to be brought down from the current statutory limit of 60pc to down to 50pc in 15 years.

The finance minister directed that these commitments should be built and adhered to in future projections of the macroeconomic framework.

He highlighted that a comprehensive and thorough macroeconomic framework enables the federal government, provincial governments as well as the private sector to plan ahead with confidence and take vital decisions in a timely manner.

The framework forms the basis of policy decisions in the areas of annual and multi-annual budgets, management of reserves, investments and economic growth.

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