Tahira Mansoor

Our leaders are acting like ostriches in that they are oblivious of the dangers that the economy is facing. The economy is in dire straits. Even its nominal growth is on the strength of huge, unmanageable borrowing.

The president, in his speech to the joint sitting of parliament, boasted that the economy would grow by 4 per cent this fiscal. This was an exaggerated estimate, as all economists, the donor agencies and the State Bank estimate the growth to remain between 3-3.5 per cent this year. The president conveniently forgot that the economy grew at an average of 7 per cent in the previous four years prior to PPP rule. In the four years of the PPP government, the growth has averaged around 3 per cent.

He has a point that the floods impacted growth which he claimed was to the tune of 2 per cent of GDP. However, he was ignorant of the fact that Pakistan faced severe devastation in the form of an earthquake in 2005, annihilating cities along with population, buildings and infrastructure and still a high growth was maintained. Nations face calamities, international sanctions and bad luck but, even then, emerge successful through prudent and transparent measures during periods of stress, adhering to rules of good governance.

However, if someone uses natural disasters for milking aid from global donors, the impact of the disaster multiplies. The present PPP-led regime lost the trust of donors, including most concerned Islamic countries, on the way it tackled the floods of 2010. It did not get any assistance in the subsequent floods that affected Sindh in 2011.

The assistance we received during the 2005 earthquake was, at least, spent on the affected people with the result that we see new towns and colonies flourishing in the KP and the Azad Kashmir. The farmers in Sindh that suffered from the floods in 2010 are still awaiting government assistance. Water in some regions of Sindh has not yet receded from the floods cause in 2011. The loser was not the government. The losers were the affected people. The government has increased its borrowing every year during its past four years of rule. The money has not been spending on welfare of the people or building infrastructure.

The president in his speech boosted that this government completed the Mangla raising project. The fact of the matter is that the project was completed in 2008, and it was un-operational since then because rupees six billion compensation to the affected residents was not released by this government for three years. This stopped the dam authorities from filling the dam for three years. So the credit of launching and completing the dam goes to previous regime and dragging its operation for three years to the present government. We lost hundreds of billions of rupees worth agricultural productivity due to lethargic attitude of this government.

The president also claimed that the second nuclear power plant at Chashma was completed during the tenure of his government. It is true, however, the credit goes to the Chinese government that started the projected much before the assumption of power by the present regime.

The Chinese provided the funding and expertise for the project and completed it on schedule.

President's assertion that Pakistan's foreign exchange reserves reached peak of $18 billion during the PPP rule conceal the fact that $8.5 billion of these reserves are the IMF support that is due for return in next three years. The reserves have already started depleting as the government paid back the first installment of $400 million to the fund in February. Another $800 million are due in June.

Pakistan's exports have definitely gone up in recent years. The government could take partial credit for this increase. However we must realize that there was much higher demand for Pakistan products in the international markets that could not be fulfilled due to extra ordinarily high energy and power mismanagement. The Pakistani entrepreneurs deserve the actual credit for high exports as they increased their efficiencies the highest possible levels to successfully confront their competitors. The rulers in fact must be made accountable for depriving the nation of a golden opportunity to market its products globally. The most painful aspect of the industry specific power shortages was that the government doled out Rs. 1.3 trillion subsidies to the power sector monopoly during the past four years most of which has been lost to corruption. This fact was revealed at a conference of the Institute of Engineers by none other than a high ranking PEPCO official in Lahore, last week.

This government is not publishing poverty figures for the last four years. All economists agree that the poverty has increased substantially during the past four years. Some experts opine that 74 million people out of 170 million populations are living below the poverty line. They have solid reasons for these estimates. Thousands of industries in country have gone sick. Most of the surviving industries are operating at 40-50 per cent of their installed capacities. The large scale manufacturing sector has registered a nominal growth of 1.5 per cent. None of the industry is operating anywhere near their production levels in 2007. Millions of workers have lost their jobs. No new jobs are being created while the nation is adding two million youth every year in its workforce. All these facts call for serious efforts to revive the economy and not to rejoice the so called achievements of this government.

Pakistan needs governance of highest order. The cronies of the rulers sitting at highest levels would not only have to go but also have to account for their corruptions and misdeeds. Pakistan simple cannot afford further bad governance and looting of its resources. The gap between the rich and the poor has been increasing at an alarming rate.

The privileges of the rich would have to be cut. The taxation should provide relief to the poor only. The rich should be taxed adequately, there should be no exemptions. The rulers would have to adopt simplistic life style as adopted by Iranian rulers. Even in the developed world the British Prime Minister lives at a modest one bedroom flat at London's 10 Downing Street. There is extra ordinary security or guards outside his home.

Source: WEEKLY CUTTING EDGE