b) stabilizing the country's economy;
c) creating a government of inclusion, and
d) combating extremism and creating a culture of moderation.
Prudent policies minimised the effects of the economic downturn, thereby mitigating its implications for the people. Furthermore, a number of economic targets have been achieved during the first six months of the fiscal year 2011-12 as a result. A new economic growth strategy seeks to foster sustainable and more equitable growth by means of structural improvements in the productive sectors of Pakistan's economy. Due to the government's efforts, economic activity in Pakistan firmed in the second half of 2011, as stated by a report released by World Bank in January 2012. The report also noted that monetary tightening brought about positive real lending rates in early 2011, the first time since late 2009.
Strengthening State Bank - In March 2012, the President approved the Amendment to the State Bank of Pakistan Bill which will serve to strengthen the power of the Central Board to formulate and implement the monetary policy and control the government borrowing. Furthermore, powers of the Federal Government to supersede the Central Board have also been withdrawn.
Reducing Inflation - The Government has prioritised reining in high inflation, brought up greatly by the cost of damage caused by excessive flooding in 2010 and 2011. Controlled borrowing has helped reduce inflation to a single digit (9.7 percent) in December 2011 from 25 percent for the first time in the history of the country. The State Bank of Pakistan also changed its policy rate to 12 percent in February 2012 to cool inflation.
Investment - The International Finance Report recognized Pakistan as the 105th most business friendly country in the world in its annual Ease of Doing Business report in 2012. Recent reforms helped sustain the country's premier position as the most business-friendly nation in the region.
Federal Revenue Distribution - On December 31, 2009, the Government and finance ministers from Pakistan's four provinces signed the Seventh Award of the National Finance Commission (NFC), an historic award because it succeeded in eliminating an approximately 15-year deadlock in discussion about federal and provincial revenue distribution. The award introduced the landmark multiple-criteria formula for redistribution of resources among the provinces, which replaced the single criterion 'population density' formula that had been in place since the first NFC award in 1974. The federal government recognized the rights of the provincial government over their resources and agreed to compensate Khyber-Pukhtunkhwa and Balochistan for past arrears especially from hydro power profit and gas surcharges and royalties. Under the latest NFC Award, nearly 70 per cent of the resources are being transferred to the provinces. During 2010-2011 alone, over 800 billion rupees have additionally been transferred to the provinces.
Benazir Employees Stock Option Scheme- Why the government worked on macro solutions to the downturn in the economy,it also divised social programmes to lessen the grip of poverty on the people. Pursuing its policy agenda of promoting social democracy that also gives social equity to the underprivileged, the Government introduced Benazir Employees Stock Option Scheme (BESOS) to make workers stakeholders in their organizations' growth and development. Launched on 14 August 2009, BESOS empowers workers of state-owned enterprises (SOEs) by offering them free ownership of 12% stocks in their organization. It is expected that approximately 500,000 employees of 78 SOEs will benefit from this scheme. Full implementation of this scheme will ultimately make employees the real owners and beneficiaries of state owned assets.
International Trade - Pakistan's Trade Policy objectives are focused on reducing protectionism, achieving a more outward-oriented trade regime, and increasing market access for our core exports. Robust exports have supported the country's external positions and contributed to an improvement in the current account from a deficit of 0.9pc of GDP in 2010 to a surplus of close to 0.5pc of GDP in the 2011 calendar year. See Global Pakistan section for key trade initiatives signed during President's term to date.
International Integration - Pakistan, being one of the founding members of the WTO, supports a system of global integration aimed at enhancing economic efficiency, competitiveness and export-led growth.
Assisting Industry - As a result of international recession, energy shortages, and a contraction in the economy, the industrial sector posted a negative 3.3 percent growth in 2009 with large-scale manufacturing posting a negative 7.7 percent growth. The industrial sector is Pakistan's engine of production and employment, but it is fragmented and lacks consolidation. The Government declared 2009-2010 as the "Year of Industrial Recovery" providing the industry much needed multi-dimensional assistance. Where 2011 is concerned, industrial production surged to grow at a robust 32.1pc annualised pace during August till October 2011, after falling at 9.1 and 10.1pc rates during the first and second quarters, respectively. A notable bright spot has been a strengthening of exports, evident particularly in the first half of 2011, led by textiles that surged 39pc in the first half of the year.
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