Prime Minister Shehbaz Sharif on Thursday questioned the performance of industries that have received subsidies for decades without delivering a significant increase in exports, urging the private sector to take the lead in driving economic growth. Addressing a gong-ringing ceremony for the listing of Naya Nazimabad Apartments REIT at the Pakistan Stock Exchange (PSX), the prime minister said incentives provided to the construction industry in the budget were beginning to produce results, with growth also being witnessed in Karachi’s construction sector. He said several industrial sectors had received subsidies since the 1960s but had failed to deliver a significant increase in exports. “Instead, the prices of goods increased, quality and productivity were affected, while import substitution could not be achieved,” he said. “This is a bitter reality that cannot be corrected without moving forward,” he said, urging exporters to play an effective role in achieving export-led sustainable economic growth. PM Shehbaz said he had held meetings with prominent bankers during his recent visits to the United States and the United Kingdom, adding that they had appreciated the government’s reform efforts. He said the International Monetary Fund (IMF) chief had told him that “this is a new Pakistan”, to which he replied: “This is not a new Pakistan, it is a new team.” “We have to show export-based growth in our economy,” he said. The prime minister said the budget had provided tax breaks worth Rs2.3 trillion and congratulated the Naya Nazimabad and Lahore projects. “In this entire scenario, there is no parallel to the efforts of the Chief of Defence Forces and the Chief of Army Staff, Field Marshal Asim Munir,” he said. Read: Response to fixed tax unsatisfactory He also thanked the chairman of the National Accountability Bureau (NAB) for recovering land worth trillions of rupees and said Pakistan had achieved major successes in the issuance of Eurobonds. The State Bank’s foreign exchange reserves had reached $21.4 billion, while remittances were showing significant growth, he said. The government had also provided tax incentives to support industrial development, while the PSX had made significant progress, he said, adding that further reforms were needed in light of developments in other markets in the region. Finance Minister Muhammad Aurangzeb, addressing the same ceremony, said economic growth would reach 4 per cent in 2027, compared with 3.7 per cent recorded last year. The finance minister said the government could raise the growth rate to 6 per cent in the short term through a consumption-led growth model, but doing so would disrupt the balance of payments and push the economy back into a boom-and-bust cycle. Instead, the government was pursuing an export-led sustainable economic growth model, under which the economy would achieve 4 per cent growth this year, he said. The finance minister said the number of tax filers had increased by 45 per cent to more than 5.7 million this year, compared with 3.9 million last year. The government was also working on reforms and tax-related issues to increase activity in the capital market, he said. Aurangzeb said Rs60 billion had been released under the Prime Minister’s Apna Ghar Programme, while the banking industry had approved Rs340 billion under the scheme. “The real issue is no longer the issuance of loans. The banking industry has taken the step; now the supply side has to take the step,” he said. He added that Arif Habib and the Association of Builders and Developers (ABAD) had to play their role in this regard, while real estate investment trusts (REITs) would act as a bridge. Read more: No more war impact, govt tells IMF The finance minister recalled that he had first visited the PSX on March 29, 2024, when the KSE-100 Index stood at 67,000 points, compared with 170,000 points at the time of his address. “The factors behind the 100 Index are important,” he said. He said 11 initial public offerings (IPOs) had taken place this year, the highest number recorded in the past 20 years. Investor participation had more than doubled over the past two and a half years, while Gen Z and millennials had accounted for 85 per cent of stock market participation over the preceding 12 months, he said. Aurangzeb said fiscal stability was a fundamental requirement for economic growth and that, for the first time, investors from Türkiye had shown interest in the privatisation of distribution companies. “Questions are raised about foreign direct investment, but these matters require time,” he said. The finance minister stated that the economy had contracted three years earlier and stressed that the government’s role was to provide the private sector with a conducive business environment. “The private sector has to lead,” he said. “Questions are asked whether this is the government’s job? This is absolutely the government’s job, and we will continue to do it,” he said. He said the government’s first priority was to make macroeconomic stability sustainable and end the boom-and-bust cycle. “Instead of achieving growth through the injection of liquidity, we have to focus on sustainable growth because once the economy enters a downturn, it is extremely difficult to revive it,” he said. The finance minister said the achievement of tax targets also needed to be highlighted rather than focusing only on instances when targets were lowered. “We now have to step into the new economy,” he said. “The new economy is not just crypto; it has other implications as well. We can lead this global service,” he added. The minister concluded that the government was seeking to expand the bond market to the retail market, while the Capital Markets Development Council was preparing recommendations to present to the prime minister.