| February 23, 2003 | Sunday | Zul Hijjah 21, 1423 |
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Not at cost of quality
IESCO’s example
WITH the last month of the last but one quarter of the current fiscal year only a week away, most of the vital indicators are showing very positive trends. The revenue collection has already achieved a growth rate of 15 per cent, a first in many years. Exports too are going up and are likely to meet the current year’s target of over $10 billion — a record in itself. Reflecting these two trends, the sales of cars have gone up by 34 per cent. The long spell of drought has broken with the recent widespread rains in the country. Home remittances from abroad have already crossed the two billion dollar mark and by the year end are likely to go beyond three billion dollars. The cost of money itself has gone down steeply during the last seven months, with bank rates coming down to a single digit, and the rupee is holding out strongly against the dollar over the last several months. The foreign exchange reserves have gone up to nearly $10 billion, with the growth trend remaining steady for almost two years — another record of sorts. The external aid environment too has continued to remain favourable. The generous third round of rescheduling by the Paris Club has created considerable financial space for budget makers and planners to focus more meaningfully on poverty alleviation and development.
At the same time, cash grants from bilateral donors amounting to 1.6 billion dollars are expected to be received before the fiscal year ends. This is going to be further augmented by another 1.6 billion dollars from multilateral donors in programme assistance in the same period. Foreign direct investment too has risen to around 600 million dollars and the year is expected to end with as much as a billion dollars coming in from outside for investment. Meanwhile, Saudi Arabia, Kuwait and the UAE have offered oil to Pakistan on deferred payment which will reduce the immediate burden of the annual oil import bill of about 3.5 billion dollars by as much as 1.8 billion dollars during the current year. The oil producing friends of Pakistan are said to have promised to keep the flow of concessional oil uninterrupted even if war breaks out over Iraq.
This is certainly a sunshine period for Pakistan’s economy. If there has been a windfall in the wake of 9/11, our financial managers also deserve credit for handling it prudently and not wasting it through extravagance or on wrong priorities. Having said that, let us be very clear on one thing: all the favourable indicators like the high rates of growth in revenue collection and exports spring from a very low base. In absolute terms, both the export earnings and revenue collection need to yield more than what they are doing now to enable the planners to take in hand projects that will generate jobs and alleviate poverty. The tax-to-GDP ratio needs to be pushed up to at least about 18 per cent from the current 12-14 per cent of GDP. To achieve this target, the country needs a higher level of investment both domestic and foreign. That would make it possible to derive the maximum benefit out of the new favourable turn in the country’s economic fortunes. The financial space now available must be used to the optimum advantage by launching projects in accordance with a well thought-out order of priorities aimed at reviving the economy, increasing production and reducing the problems of poverty, unemployment and socio-economic backwardness generally.
A STATEMENT by the minister for information and technology that action should be taken against mobile telephone operators to force them to improve their quality of service is very welcome. It is about time the government, especially the Pakistan Telecommunication Authority (PTA), woke up and took notice of the continuing decline in the quality of service and connections offered by the four leading mobile phone companies. A common complaint by cell phone users all over the country is that the line drops all too frequently, that the voice coming through the network is crackling or ‘breaking up’ and that reception is bad. Each time a call drops, usually because of problems in the network, the subscriber has to dial again, and pay the charge for an extra call. Many users believe, that this is just another way for the mobile phone companies to increase their revenue.
Hopefully, the minister’s words will be followed by action. The PTA should make it its business to pull up the mobile phone companies. With the introduction of the ‘calling-party-pays’ system there has been a boom in mobile phone connections, with the number of users estimated at around three million. Unfortunately, this increase seems to have come at the expense of service and the quality of connectivity. In their attempts to have as large a market share as possible, the cell phone companies have expanded too quickly, much beyond their installed capacity, thus adversely affecting their ability to provide quick and reliable connections to all their customers. The minister has also talked of increasing the fines that can be levied on mobile companies if service standards are poor. However, the issue here is not so much of increasing penalties as of ensuring strict compliance with the required standards of service. Cell phone companies should be monitored over a period of time, after which their performance should be assessed. The PTA as the regulatory authority should then fine those firms which fail to provide the required standard of service.
THE new system of bill collection introduced for the first time in the country by the Islamabad Electric Supply Company (IESCO) is a welcome move that will make it easier for consumers to pay their power bills. The scheme allows consumers to pay their bills through crossed cheques, to be dated at least two days before the date of submission, by dropping these in any one of the 102 drop boxes placed at key departmental stores and other prominent points in the twin cities — 47 in Islamabad and 55 in Rawalpindi. The contract for collecting these bills from the drop boxes has been awarded to a private firm. This new scheme will make power bill payment a less cumbersome task for consumers who often have had to take time off to queue up in rain or scorching heat to pay their power bills at various designated branches of national banks and post offices.
However, IESCO has limited this facility only to those consumers with bills of less than Rs 5,000. Bills exceeding this amount will still need to follow the old method of being deposited at designated banks, post offices and ten new billing centres in Rawalpindi. IESCO estimates that the new bill collection scheme will facilitate some 100,000 consumers in the twin cities. If this estimate is based on consumers’ winter power bills, IESCO ought to consider increasing the limit amount for which consumers can pay their bills by crossed cheques through the drop box facility. This is because the number of consumers who can make use of this new facility will decrease considerably during summer when the power bills of many are likely to go beyond Rs 5,000 because of the use of air-conditioners, coolers and fans. In any case, the drop box is a consumer-friendly method of bill collection which the other utility services in the country should consider employing as it helps save time, energy and hassles involved in clearing dues.