When Finance Minister Ishaq Dar rises on the floor of parliament on Tuesday to deliver his annual budget speech, Pakistanis will be certain to hear a rich dose of good news surrounding the country’s economy. It will be another insightful moment to witness the now all-too-familiar gap between a powerful set of dismal realities across Pakistan versus the mood in the power corridors of the capital city.

That the slide of the rupee has been reversed and liquid foreign currency reserves continue to recover, are bound to form an important bedrock of Mr Dar’s message. He had taken it upon himself to halt the slide of the rupee when Prime Minister Nawaz Sharif returned to Islamabad just last year.

“The downward slide of the economy has been stopped. The tide is beginning to turn,” was how Ahsan Iqbal, deputy chairman of the Planning Commission, put across the official narrative in his pre-budget comments on a Sunday TV show.

It may be difficult to immediately disagree with some of these claims. Just a year ago, many Pakistanis with means to afford converting a part of their wealth to a foreign currency were clearly worried in the midst of a sliding rupee. Clearly times have changed.

The anxiety of the past has turned into a moderate comfort level, with policymakers like the accountant-turned-finance minister Dar pointing towards a robust improvement in Pakistan’s fortunes. Yet, tackling a stubbornly complicated economy like Pakistan takes far more than just an accounting exercise and stability of the rupee. While the good news is welcome, the profoundly tough question is just one — is Pakistan’s economy beginning to change sustainably?

Beyond the rupee, the PML-N’s economic mantra has been built around new infrastructure projects including some clearly fanciful if not controversial ones. Notwithstanding the destruction to environmental interests across Islamabad, the so-called metro-bus service linking the capital to Rawalpindi continues to be zealously pursued.

Meanwhile, a new urban train project with Chinese assistance has been pushed into motion for Lahore, the hometown of Prime Minister Sharif. And last but not the least, the ruling camp is keen to oversee a new train service launched from Rawalpindi and Islamabad to Murree with an onward connection to Muzaffarabad, the capital of Azad Kashmir.

At the same time, the plan for Pakistan’s future development includes a string of motorways, notably linking Lahore to Karachi. Given Pakistan’s shrinking resources, such pursuits will have to come at the cost of other commitments.

If there was enough money in the kitty, any one or indeed all of these projects barring the ones that promise environmental destruction were worth pursuing. But life in today’s Pakistan is significantly more complicated.

Pakistan’s economic planners need to choose the right set of priorities in an electricity and increasingly water-starved country. While Pakistanis suffer in neighbourhoods with virtually non-existent street lights and intermittent power cuts, it is clear that the crisis surrounding Pakistan will not be overcome with an accelerated development programme adopted by the PML-N regime.

In the assessment of Hafeez Pasha, a former federal minister with responsibilities for economic management, chronic challenges such as bringing in the revenue to afford the planned expenditure remains a pressing question. “The revenue target is not feasible especially in an economy which is not moving,” says Dr Pasha referring to recent press reports of the government considering unveiling a higher tax collection target for the coming financial year.

It is no secret that Pakistan is one of the world’s worst performers when it comes to collecting taxes. With a tax-to-GDP ratio hovering around nine per cent, just over one per cent of the country’s population pays an income tax. The other 99 per cent are not all too impoverished to foot their tax bill. They include a large community of rural landowners with a strong representation in Pakistan’s elected legislatures.

Clearly, more than a bureaucratic exercise to widen the net around potential taxpayers, Pakistan needs a so-far-missing political will to break new ground in this area. A failure to do so will keep on forcing one regime after another to run up the national debt through financing of grand new projects while the economy’s future remains lacklustre.

Meanwhile, in recent weeks the prime minister has presided over high-profile events to oversee the launch of new power generation projects — underscoring his government’s focus on the power crisis.

Yet, long-term observers of Pakistan’s developmental scene claim that adding more power to the system deals with just part of the problem. “We have major gaps in our transmission system where Pakistan suffers from big power losses,” adds Akhtar Hasan Khan, a former senior civil servant with experience of leading the official team of national planners in Islamabad.

Clearly, the issues with tackling power losses of more than 30 per cent during transmission are widely known. Yet, seeking to ignore them for now while pursuing other high-profile ventures must put across a dangerous bottom line: Pakistan may look like it’s a changing country while it remains at a standstill.

The writer is an Islamabad-based journalist who writes on politics, economy and security issues

Published in Dawn, June 2nd, 2014