ISLAMABAD: Finance Minister Senator Muhammad Ishaq Dar began presenting the fifth federal budget of the ruling party on Friday. 

"For the first time in Pakistan's history, an elected prime minister and finance minister are presenting their fifth budget. This shows the strengthening of democracy in the country," said the minister.

The minister got the opportunity to present the budget after the speaker allowed Opposition Leader Khursheed Shah to address the House. 

Pakistan was on the verge of defaulting in 2013 and the economy was declared unstable on the basis of macroeconomic indicators, the minister recalled.

"Today, the country's foreign exchange reserves are adequate enough for four months of imports. The supply of gas has improved, and load shedding has been completely halted for the industries. Inshallah, load shedding will end for good come next year," he added.

"Today, reputable organisations like Pricewaterhouse Coopers are saying that Pakistan will enter the G-20 group of nations in the near future," claimed Dar.

The GDP growth rate was was 5.3% in the last fiscal year ? highest in ten years, he stated, adding that it is for the first time that Pakistan's economy has grown to over $300 billion. "This shows the strengthening of the economy," said Dar.

The assembly session formally started with prayers at the Parliament House around 4:45pm for the presentation of the federal budget.

Presenting the Economic Survey 2016-17 on Thursday, the finance minister had forecast a growth rate of 6% for the next fiscal year.

According to government sources, the PML-N's fifth budget is expected to lend further focus towards improvement in economic growth, maintaining fiscal discipline, reducing on-development expenditures and boosting exports besides providing relief to the masses, promoting investment for job creation, treading the people's friendly policies for overarching socio-economic prosperity.

The key focus in the budget would be on infrastructure and human resource development while the government is likely to enhance allocations for the social safety net for providing maximum relief to the vulnerable segment of the society, sources said.

Finance Minister Ishaq Dar presenting the PML-N government's first budget in 2013. Photo: File/AFP

It would also focus on social sector development and revenue enhancement measures, besides introducing reforms for improving governance and boosting private sector investment.

On the revenue side, the government would introduce measures for bringing improvement in the system of tax collection, broadening the tax base, and facilitation to taxpayers, they said and argued that strong revenue generation will play a crucial role in achieving the targets for economic growth.

From the growth perspective, the federal budget would focus on generating 6% gross domestic product growth (GDP), and for this purpose, the government would introduce some fiscal measures and policy initiatives.

The National Economic Council (NEC) chaired by Prime Minister Muhammad Nawaz Sharif on May 19, had already approved the GDP growth target at 6% for the financial year 2017-18 while the government achieved a GDP growth rate of 5.3% in the outgoing fiscal year.

The NEC also approved country's consolidated development budget of Rs2.5 trillion for the upcoming financial year (2017-18), showing the highest-ever increase in the overall national outlay.

This included Rs1,001 billion Federal Public Sector Development Programme (PSDP), Rs1,112 billion provincial PSDP while Rs400 billion would be spent by various corporations from their own resources to carry out their development projects.

The development financing for Azad Jammu and Kashmir in the upcoming PSDP has been enhanced from Rs12 billion to Rs22 billion, for Gilgit-Baltistan it has been increased from Rs9 billion to Rs12 billion, while an additional package of Rs3 billion for GB, hence taking the total funding to Rs15 billion for the region.

Development funding for the Federally Administered Tribal Areas has also been increased from Rs21 billion to Rs24.5 billion.

The social sector was given importance in the development budget, financing for which has been increased from Rs90 billion to Rs153 billion.

In order to promote higher education and lead the country towards development, the budget for the Higher Education Commission(HEC) has been increased from Rs21 billion in 2016-17 to Rs35.5 billion in 2017-18. The government would announce growth targets for the upcoming fiscal year.

According to official sources, the agriculture growth target would be fixed at 3.5%, manufacturing at 6.4%, services sector at 6.4%, while inflation would be curtailed at 6%.

The investments are expected to go up from the current 15.8% to 17.2% percent, while exports are projected to reach $23.1 billion. 

During the outgoing fiscal year, the agriculture sector posted a growth of 3.46%, large scale manufacturing grew by 5.06% compared to 4.64% last year, while the headline inflation consumer price index averaged at 4.1% during July-April 2017 against a target of 6%, showing that inflation will remain below the target.