ISLAMABAD, Dec 31: Adviser to Prime Minister on Finance and Revenue Shaukat Tarin said on Wednesday that the government would release next week Rs20 billion bailout package for the stock market to support sinking bourses.

“The government-owned institutions will start purchase of shares from next week. The purchased shares will be sold to overseas Pakistanis,” the adviser said while replying to a question at the National Assembly Standing Committee on Finance and Revenue.

Talking to newsmen after briefing the standing committee meeting, headed by its chairperson MNA Fouzia Wahab, the adviser said Pakistan would receive $1 billion loan from the World Bank and Chinese government in the next few months.

Of these, $0.5 billion would come from the World Bank in the next three to four months while the Chinese government would release $0.5 billion in the next three to four days to Pakistan, which would help raise country’s forex reserves.

The adviser announced that the Continuous Funding System (CFS) in the stock market would also be gradually phased out. However, brokers are divided over elimination of the CFS.

Last week, IMF’s Middle East and Central Asia Director Masood Ahmad visited Islamabad and gave a go-ahead signal to the finance ministry for supporting its sinking stock market in the wake of removal of floor on Dec 15.

The adviser briefed the committee about the steps taken by the government so far to stabilise the stock market in response to concerns expressed by members of the committee.

He said that the support fund would be set up by four state-owned institutions — NBP, EOBI, State Life and NIT — with borrowing guarantee from the government.

He, however, made it clear that no country in the world has announced any bailout package for their stock markets in the wake of global economic meltdown and Pakistan would be an exception.

Mr Tarin said that the growth during the current fiscal year would remain between 3 to 3.5 per cent by the end of June 2009.

He said that inflation has started a downward trend mainly because of falling international oil and commodities prices.

FBR: The standing committee approved the establishment of a foundation and fund for Federal Board of Revenue (FBR) employees. The fund would provide support and incentives including subsidy in the housing, transport, medical and education to the employees.

The FBR would be empowered to grant incentives and rewards to its employees based on their performance and targets achieved by them. During the discussion, the FBR was informed that the automation has led to reduction in corruption.

The committee also discussed amendments in the companies (Appointment of Legal Advisors) Act 1974 and directed the ministry of finance to make a comparison of such laws in other countries and report to the committee, when the bill was taken up for discussion by the committee. However, some members have asked for complete elimination of the act.

Source: The Dawn