ISLAMABAD: The government should take steps to reduce the size of the cash economy which will boost the GDP, a business leader said Wednesday.
Trend of amassing local and foreign currency and prize bonds is increasing as the government is striving to expand the tax base and document the economy, said Shahid Rasheed Butt, former president ICCI.
He said that currency and prize bonds of the large denomination have made taking and giving bribes easy while it hinders bank transactions.
Shahid Rasheed Butt said that currency worth Rs2328 billion was in circulation during 2013 which jumped to Rs5234 billion in 2018 and now it stands at almost Rs6 trillion which is almost half of the entire bank deposits.
Some of the economic decisions of the former government backfired to double the size of the cash economy which if brought back to the level of 2013 will increase bank deposits by almost Rs4 trillion.
The government will generate revenue, interest rate would be reduced and banks would be more than willing to provide cheap credit to the private sector.
Such a step will change the overall economic scenario, result in radical changes in the system and trigger development at a fast pace.
He said all the prize bonds should be registered to which are worth Rs946 billion.
