Finance Minister Aurangzeb says economy moving in right direction

ISLAMABAD:  Finance Minister Muhammad Aurangzeb said Saturday that Pakistan’s economy is moving in the right direction and the country is now shifting from stabilization toward growth.

Addressing a post-budget press conference in Islamabad, Aurangzeb said the government aimed to provide relief to lower-income salaried individuals, noting reductions in income tax rates for different salary brackets.

He said the tax rate for certain salaried categories had been reduced from 5% to 1%, while another bracket was lowered from 15% to 13%, adding that feedback on measures targeting higher-income earners and surcharges had been positive.

The finance minister said taxes in the construction sector had been reduced to encourage activity, while agricultural credit had increased by 15%, exceeding 2 trillion rupees in volume.

He added that efforts were underway to strengthen a fertilizer-related scheme and that small farmers would no longer be required to mortgage their homes to access loans. He also said a youth loan program worth 262 billion rupees includes 125 billion rupees allocated for agriculture.

Aurangzeb said customs duties, additional customs duties and regulatory duties had been eliminated on imported agricultural machinery to support the sector.

He said inflation is expected to ease further if geopolitical tensions in the Middle East subside, adding that economic stability indicators have shown improvement over the past year.

The minister said the government had introduced measures in the budget to improve taxation and export systems, including 70 billion rupees in additional subsidies aimed at boosting exports.

He acknowledged pressure on the energy infrastructure but said it would continue to remain a challenge in the coming fiscal year.

Aurangzeb also expressed gratitude to provincial governments for their financial cooperation with the federal government, saying the arrangement would continue for the next three fiscal years.