In press interaction, P.M. Imran Khan announces Rs. 200bn for laborers, lower fuel prices, reduced or abolished taxes on food items
Prime Minister Imran Khan on Tuesday announced a stimulus package to support Pakistan’s economy amidst ongoing provincial lockdowns designed to curb the spread of the COVID-19 virus.
“In many countries a curfew has already been placed. Had I been in Italy or France, I would have no qualms in placing a curfew. When I think of Pakistan, I think of how we will get food to the people,” Khan told a select group of journalists in Islamabad.
The prime minister criticized the decision of all four provinces to initiate lockdowns—severely restricting movement and banning all large gatherings of people in public and private—claiming these measures only supported the “elite.” He said: “When I place a curfew do I ever think of squatter settlements where there are 8-10 people living in a single room? And this is … not a normal curfew where you can come out to buy groceries from the marketplace in the evening. Here, if you allow such a thing, it will defeat the purpose of the exercise.”
According to the prime minister, the ongoing lockdowns—set to expire on April 6—would be reviewed and revised as needed in light of the evolving situation surrounding the spread of the novel coronavirus in the country; the confirmed cases of the deadly disease had hit 1,000 on Wednesday morning.
Khan said the government had, over the past few days, debated and approved a stimulus package to buffer the damages that would be faced by the economy due to businesses being shut down by coronavirus. The key points are as follows:
- Labor—Rs. 200 billion has been earmarked to cater to laborers who might be rendered jobless during the lockdowns.
- Exports—Rs. 100 billion in tax refunds have been allocated, and interest payments have been deferred to encourage them to support their labor.
- Small and medium industries—Rs. 100 billion have been set aside for the sector; its interest payments have also been deferred. They will also be provided concessional loans with low interest rates, while farmers would receive lower input costs.
- Low-income families—the government has set aside Rs. 150 billion for impoverished families, which would be spread across the next four months in the form of a Rs. 3,000 monthly allowance. The recipients would be determined through collaboration between the provinces and the federal government.
- Expansion of Panah Gah—the numbers and capabilities of existing shelters would be expanded, and measures introduced to screen all people entering.
- Utility Stores—the government has set aside Rs. 50 billion for the company to ensure the consistent availability of basic necessities. Plans to budget Rs. 280 billion for wheat procurement from farmers were also announced.
- Fuel—petrol, diesel, kerosene and light diesel would see their prices reduced by Rs. 15, from March 25.
- Electricity and gas—households who utilize 300 units or less of electricity would have their bills deferred over the next three months; similarly gas consumers who have bills equal to or less than Rs. 2,000/month would be able to pay bills in installments over the next three months.
- Medical workers, equipment—Rs. 50 billion has been allocated for the procurement of protection equipment of medical workers who are at the forefront of the fight against the virus.
- Food items—all existing taxes would be temporarily abolished or reduced to lower costs for consumers.
In addition to the stimulus package, Rs. 100 billion has been set aside for use in case of an emergency to counter the after-effects of the lockdowns. The prime minister said the National Disaster Management Authority would be granted Rs. 25 billion to procure kits, equipment, and other items from other countries.
He also claimed the government is working on a special package for the construction industry, which “aids in wealth creation.”
Separately, Economic Affairs Minister Hammad Azhar said the relief and stimulus package was worth Rs. 1.2 trillion and would help the local industry and offered “support to poor.” In a posting on Twitter, he said the package “seeks to provide relief to vulnerable, support to poor, SMEs [small- and medium-sized enterprises], industry.”
He added: “The objectives of the Economic Relief and Stimulus package is to provide relief to vulnerable segments, to prevent job losses, encourage smooth supply of essential goods at reasonable prices, support businesses and stimulate the economy.”