The failure to act
IF the economy is in as bad a shape as the two finance ministers since March this year have suggested, then the budget presented in parliament last week, fails to address issues to turn the economy around. In fact, by not addressing pressing problems at this juncture, the government is digging yet another grave to find itself buried in, within a very short space of time.
This lost opportunity to move forward on the economy is symptomatic of the way this government has been functioning, a fact displayed in the two other critical areas — with regard to the president and the judiciary — where it has been unable to act and to forge ahead. Its failure to act clearly and forcefully on the economic front, in a timely manner will, in all probability, only add to causes which will result in its own undoing.
Moreover, in a broader political-economy framework, one can add to this line of argument, the fact that the inability of the government to use the annual budget in order to deal with what the last finance minister kept referring to as the economy’s ‘meltdown’, only underscores the point made by many observers that this government will be unable to govern and to move forward, unless it deals with the two most pressing problems facing it. As long as the issues of the president and the judiciary hover over the head of the government and its allies, governance will be ineffective and weak. Hence, economic revival will also not be possible.
Of course, the present government is in no way responsible for the numerous problems that afflict Pakistan’s economy, yet the fact that it is in power, assumes that it must take responsibility if it fails to address these problems. While we celebrate the return of the democratisation process, albeit one which continues to be partial and interrupted, we also have expectations from the government that it must fulfil its responsibilities.
The main economic indicators show that a deteriorating trend has been in process for some months now. The GDP growth rate expected to be 5.8 per cent, is still considerably higher than the average for the 1988-2003 period, but is lower than the trend seen over the last five years. While perhaps this slowing down in the growth rate was to be expected given adverse international commodity prices and on account of the fact that the previous growth was built on weak foundations, expectations suggest that growth is going to be lower for some years to come. With a growing fiscal deficit at present around seven percent of GDP, the highest in over a decade, and a current account deficit worsening as oil prices rise, all estimates for GDP growth seem to be optimistic. While these three key indicators need to be addressed soon by the government, what is particularly important from the point of view of a democratic and popular government is to be able to address the single most important issue which affects all citizens, namely inflation.
With inflation at around 11 per cent, the highest in the last three decades, any government would have had a major task dealing with causes which are not in its control. The rise in food and oil prices globally are the main reasons why inflation is so high, although a number of poor decisions and an equal number of indecisions by the Shaukat Aziz government and the caretaker government, have made things far worse. Moreover, the economic policies of the previous government are responsible for creating an artificial bubble which has resulted in a substantial deterioration in income distribution.
The finance ministry must realise the scale of the issues it has to confront and has to quickly deal with if it is to make its mark on the economic front and stop the economy from deteriorating further. However, the budget does not show any substantial sign of an attempt to turn around the economy, and although a couple of measures have been taken, they are insignificant to deal with the nature and scale of the problems. The imposition of import duty on luxury items was long overdue, and the attempt to provide an income support programme for the poor, is welcome. Development expenditure has also been raised, as is standard practice, and one can only hope that better and effective targeted provision of all government expenditures take place. What is troubling, however, are a number of measures announced in the budget, and many that are conspicuous by their absence.
The cut in subsidies might help marginally lower the fiscal deficit, but will probably result in higher prices for oil, power, fertilisers and food items for consumers, especially the poor. Similarly, an increase in the proportion of indirect taxes will also have a disproportionately higher incidence on lower income earners. Neither of these two measures will help the poor and will further challenge their ability to survive under worsening economic conditions mostly related to rising inflation.
With a tax-to-GDP ratio of a mere 10 per cent and with a fiscal deficit of around seven per cent of GDP, one would have expected the government to be considerably more imaginative on the revenue generation front. It is unforgivable that the government has allowed the exorbitant profits from the stock market to go untaxed for another two years. There is no reason why profits from speculation should be untaxed under stable and normal circumstances, and under conditions where the economy is facing serious crises, such generosity is criminal.
The government should have gone out of its way to give inflation and food shortages its highest priority. It should have had a short-term, immediate, focus which would have meant compromising on other issues at the moment, and a medium and longer term economic agenda. One would have expected that the Peoples Party election manifesto, launched with much fanfare, would have had more substantive issues addressed with regard to the economy, some of which would have found expression in its first budget.
The disappointment one has with regard to last week’s budget is just another indication of the democratically elected government’s failures to act on a number of critical issues. In fact, one can argue, that only after a new president is elected and the old judiciary is back, will other issues be addressed. For one thing, the main coalition partner — PML-N — will be back to participate in government and the problem regarding political uncertainty resolved. Perhaps only once these ‘political distractions’ are dealt with, will we get better and effective economic management.
The PPP’s game playing
IT is far from clear what the lawyers and their political sympathisers have achieved from last Friday’s long march on the capital other than redrawing the government’s attention to the issue of the judges’ restoration. That alone was perhaps not the intent of the much hyped-up effort.
Thus, many in the mammoth crowd that gathered in front of parliament went home disappointed and with a vague promise of launching a train march if their demands were not met anytime soon. There is no indication from the government’s side that it is in any hurry to take up the judges’ issue other than in tandem with the greater constitutional amendment package proposed by the PPP.
On the eve of the long march, the government appeared a bit shaken before a code of conduct was finally agreed to with the lawyers’ representatives. On Saturday morning, minutes after the participants dispersed, it congratulated itself on having ‘allowed’ and rather ‘welcomed’ the rally which was in sharp contrast to what any previous government would have done under the circumstances.
To the ordinary citizens glued to TV screens as the media built the momentum for what was termed as a historic march, and who in their respective cities had come out to cheer and see off participants going to Islamabad, the climax just fell short of expectations.
Late on Friday night the people saw and heard leaders vowing to change the system only to wake up the next morning to hear that all had passed off well, after all. So what, you may ask, was all the fuss about?
There is no doubt that the event could have been better coordinated and prepared for it to sustain the pressure on the government to restore the judges and do so sooner than later. Instead, it was allowed to go out in too many directions, with the participating major political parties, all quite right-of-centre, turning it into an anti-Musharraf, anti-US rally; those on the margins included a few nationalist groups, the Jamia Fareediya/Hafsa students and the relatives of the people gone missing since Mr Musharraf took a U-turn on the Afghan policy in the aftermath of 9/11.
The lawyers’ cry for the restoration of the sacked judges, which was the mainstay of the long march, was virtually drowned in the cacophony of their political allies. It seems that all the talk of a sit-in to push for their demands was either hogwash or a case of miscommunication.
The few who took it literally and wished to stay on in the capital had to be convinced that that after all was not the intent of the lawyers. But that critical non-intent was kept very close to the chest by leaders like Barrister Ahsan even as the long march reached Islamabad.
Now with the PML-N and the lawyers having used up the caveat they held out to the PPP-led government, what’s next? Whether even half as many people can be convinced to join a train march that the lawyers may announce in the days ahead remains very doubtful.
But the real casualty of the whole affair has been the chance to hold the PPP accountable for committing to the cause, including the mechanism to restore the judges through a resolution followed by an executive order, as it did under the Bhurban Declaration.
It is now clear that there was little will on the part of the PPP behind the commitment it made perhaps only to placate the Sharifs at that point in time.
A certain arrogance has since defined the party’s posturing vis-à-vis its coalition partners on the one hand and the president on the other. The catty game of mousing around has left Mr Zardari gloating and his party’s ministers cheerleading. Consider the acrobatics the PPP has played with each one of its allies, and its slighted benefactor in the presidency:
The party signs the Bhurban Declaration and does not fulfil its commitment; when faced with a rebuke from the PML-N, it hits back by unilaterally scrapping the Kalabagh dam project; it offers the ANP the carrot to rename the Frontier, but reneges on honouring the provincial government’s accords reached with the local Taliban; it asks the MQM to join the Sindh government, then says it will scrap the city and district government system.
It gets Mr Musharraf to fully implement the PPP-specific NRO, then vows to be the party that will eventually impeach him; Maulana Fazlur Rahman should count himself lucky that he has been left alone for now.
Next month as the party completes its first one hundred days in power with likely not having fulfilled the promises it made when it took office, it’ll be time again for bigger game playing for Mr Zardari.
Less than six months after Ms Bhutto’s tragic assassination, he is the most powerful man in his party and the country; what’s left of the party he heads is at his beck and call; the country cannot move an inch forward without securing his blessings. Even US ambassador, Anne W. Patterson must be among those grudging him all this power, just as her Pakistani counterpart in Washington is having to act sheepishly while on the Hill or in the White House.
Meanwhile, the lawyers need a lot of luck to make any headway with the man concerned in their cause to get the judges restored.
What do Sindhis want?
THE one common thread in all the correspondence I received in response to my article, ‘Respecting Sindh’ (published on June 2), was that education should be made the foremost priority in the entire province.
This is a view shared by urban and rural Sindhis alike. Those who make decisions in and for Sindh would do well to heed the desires of both educated and uneducated Sindhis as the latter’s ignorance should not keep them from identifying the key to the doors of opportunity for their children.
There is a saying amongst the people of the interior: “education can help a blind man see”. It also has another version: “education is the third eye.” Surprisingly, in a study conducted by the Sindh Education Foundation, a villager demonstrated much wisdom. “Education differentiates humans from animals,” he said. Are these words from ignorant, unenlightened people or from the poorest in Sindh who may have never learnt to read or write, but continue to desire a different destiny for their children?
An equal number of readers showed their displeasure at what they took to be my so-called defence of piri-muridi and feudalism. I didn’t know whether to laugh, cry, or bang my head against a wall at the fact that my message was so badly misunderstood by my compatriots. Rather than defend a defunct, corrupt system, I had said that these systems must be thoroughly and honestly evaluated for their strengths and weaknesses in their historical context. It would be ridiculous to suggest that these systems remain unchanged for an eternity. Furthermore, what eventually happens to these systems is up to the people of Sindh, not me. Change will come if people truly desire it, but as long as they continue to criticise from afar and do nothing about the status quo, nothing will happen. If we Sindhis want to see progress in our province, we are going to have to work for it.
However, what is clear is the fact that Sindhis have indulged in such dialogues amongst themselves for decades, but few have listened. What I found in most letters I received was a sense of frustration that vital issues — education, healthy, security, political equality — have long plagued the province, and yet they are given negligible priority at the national level. Sindh is as lost as Atlantis, a modern-day Forgotten Land; an infinite source of revenue for the centre that never receives anything in equal measure.
I had posed a question: what do Sindhis want? And decided to address and answer it in this essay. I therefore emailed this question to all Sindhis who wished to respond. The answers were more telling than anything I could ever write. I will share some of the responses with you, so that this article does not merely expound upon my own ideas, but represents the voices of many.
The first response is a quote from an extremely eloquent letter sent to me by journalist Naween Mangi, who has spent many years reporting from all corners of Sindh. “… disenfranchised, desperately poor, and presently starving Sindhis want … very few things. They want homes; the majority of villagers sleep on baking open grounds. They want water; even in villages where there is plentiful sweet water just seventy feet below the ground, there is no access to it. They want healthcare, where government BHUs stand crumbling and non-functional. They want toilets, where thousands of women are forced to use the fields and disease among children is widespread. And they want schools, not more money for poorly run government schools, but an education that will actually get them jobs.”
Ms Mangi, who is running the Ali Hasan Mangi Memorial Trust, which hopes to work in a single village to establish a model that will address education, health, community empowerment, sanitation, water and housing, adds: “While feudals may have done great things in the past, it is not untrue that many of them have kept their people suppressed beyond humanity. I have met and spent time with dozens of third generation bonded labourers in Thar….Even in more ‘moderate’ districts like Larkana, efforts to set up schools and promote education and openness among people are not taken well by the landlords… moreover, these waderas (feudals) who have both influence and financial means, have done little to provide basic infrastructure or even motivate communities for self-help.”
Dr Shivkumar Israni from Mumbai, a Sindhi Hindu doctor whose parents migrated after Partition, said: “It is sad to read the plight of Sindhis in today’s Sindh in Pakistan. Although in India, Sindhis don’t have a separate state, through their sheer hard work and dedication, they have done exceedingly well. Today, so many educational institutions including colleges, leading hospitals and businesses belong to Sindhi Hindus who came to India after Partition. In fact, many are also known for philanthropy.”
These are just two opinions, but it’s clear that given the right circumstances, Sindhis can achieve tremendous success. So why have we in Sindh allowed our self-esteem to be destroyed, accepted the lowest position in society, allowed the powerful few to triumph at the expense of the weakened many? When are we going to stop blaming others for our plight when it is obvious that we find the status quo more comfortable than change and progress?
I end my columns with a question because I think it is time we Sindhis started looking to ourselves for answers.
The writer is a Pakistani novelist.