GIVEN how politics ends up dominating all discourse in our country, it does not sound like a bad idea to have a charter of economy that encapsulates some key areas of consensus and separates economic policy from politics.

The idea has been floated in the past by the government, and most recently the finance minister again referred to it at the conclusion of the general discussion of the budget.

Take a look: Dar presses for ‘charter of economy’

There can be little doubt that the conduct of economic policy needs to be less influenced by politics, and it is worthwhile to recall that the PML-N itself did the most to politicise economic matters when it was in the opposition. Its members were the most vocal in opposing documentation measures, efforts to reform the GST, any manner of privatisation or divestment of shares in state-owned enterprises, or any new revenue measure.

While opposing new initiatives of the last government, the PML-N also invoked every populist trope that Finance Minister Ishaq Dar bristles at today.

For example, the PML-N criticised the then ruling party for raising oil and electricity prices and the then senator Ishaq Dar himself did his best to stymie the RGST by deflecting the debate away from the tax reforms towards other issues such as reform of public-sector enterprises and elimination of tax evasion.

Then president Zardari had to reach out to Nawaz Sharif directly, through a letter, and ask for his support in economic matters, an overture that was rejected summarily.

Now that his party is in power, the finance minister is perhaps discovering that it is far easier to stymie reforms than to shepherd them through the legislative process.

Yet, in spite of the history outlined here, it would be wise on the part of the opposition to accept the invitation from the government to formulate a consensus around economic policy enshrined in a charter of economy.

If anything, the history of the PML-N in opposition is the clearest proof that such a charter is badly needed.

Continuing the tradition of opposing reform measures simply for the sake of opposition would only keep the country stuck in the same self-destructive cycle.

But developing a charter of economy is going to prove far more complicated than the charter of democracy was. The economy requires the application of different economic policies depending on the circumstances.

Economic policy can be about pursuing growth, or employment generation, or redistribution or consolidation, depending on the governing philosophy of the ruling party and the circumstances that obtain in the country.

Tax policy can be reformed to pursue objectives such as elasticity or equity.

If a consensus can be developed on the broad outlines of the economic policy that the country needs, that indeed would be a positive step. But nobody should underestimate the difficulties involved in keeping politics out of economics, least of all the finance minister himself.

Published in Dawn, June 21st, 2015

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