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In his first month, Abbasi talks energy

Updated September 05, 2017

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The first 30 days of Shahid Khaqan Abbasi in Prime Minister Office mark a continuity of economic and social policies initially followed by his ousted leader, Nawaz Sharif.

If bureaucrats and businesses were upbeat over a man from the corporate sector with an interest in the economy replacing an old-styled, king-like, businessman presiding over sessions on government affairs, their high hopes appear to be fading as Mr Abbasi adopts a ‘business as usual’ route.

They were happy for having been asked the right and on-spot questions but disappointed with the outcome — no policy initiative has come about as yet except for the usual statements.

This was particularly true about various sessions on health, education and similar subjects of common interest where the ‘desires’ and ‘directives’ of the new prime minister were announced even though the federal government has a limited role to play in such matters.

The hallmark of PM Abbasi’s brief stint has been the creation of a ministry of energy through restructuring the petroleum, power and water divisions. The move was part of the PML-N manifesto, but its implementation was delayed by the then leadership to ensure completion of energy projects without confusion.

The new prime minister moved quickly to centralise economic decision-making, becoming the head of key forums — in some cases by virtue of his position and in others by design — thereby curtailing Finance Minister Ishaq Dar’s role as a de facto deputy prime minister. In the same breadth, the privatisation and statistics division were also separated from Mr Dar’s domain.

Mr Abbasi as PM was required to head the country’s highest decision-making National Economic Council, the Council of Common Interest (CCI), the federal cabinet and National Security Committee (NSC).

PM is under instructions from the party head to ensure continuation of policies and completion of projects launched during the last four years

He, however, made sure to personally head the ECC, Executive Committee of the National Economic Council (Ecnec) and a series of other cabinet committees such as privatisation.

He also made sure to call and preside over at least one session of all these forums in his first 30 days in office, advised by top bureaucrats, advisers and technocrats of Nawaz Sharif to complete a cycle of briefings from all arms and wings of the federation in order to send a message of stability.

But the substance of decision-making, if any, has not been impressive. In his first speech on the floor of the national assembly, the new prime minister touched upon the need for expanding the country’s tax base and banning licences of automatic weapons to civilians.

He has seen at least three dedicated briefings on taxation policies and the economic situation but without any apparent direction to broaden the tax net.

To his embarrassment, former Interior Minister and cabinet colleague Nisar Ali Khan publicly announced that he had banned licences of automatic weapons in the initial days of the PML-N government four years ago.

The economic fundamentals have either worsened or remained unchanged since Mr Abbasi entered the PM Office on Aug 1.

The stock market — the so-called barometer of the national economy — started sliding ever since the PML-N supremo Nawaz Sharif appeared to be losing the Panamagate battle and has continued on a downhill journey since then.

His engagements with businessmen in Karachi have been of little help and so has the tale of declining exports, notwithstanding huddles with textile and other exporters because of the missing substance in policy.

Most of the decisions under PM Abbasi pertained to routine approval of projects and day-to-day economic coordination.

They remained energy centric — his prime area of interest as former minister for petroleum and incumbent energy minister, in addition to his premiership. That was evident from nine out of ten items in his first ECC meeting’s agenda coming from the petroleum division.

The first sessions of Ecnec, too, focused on energy-related projects, besides a major motorway project approved earlier under former prime minister Sharif.

Most of the policy guidelines emerging from Prime Minister Office relate to the implementation of initiatives and projects announced and approved under the 2017-18 federal budget like clean drinking water for all and energy for all.

He has yet to make any move that suggests Pakistan was going to deliver on international commitments such as the Sustainable Development Goals.

Mr Abbasi made sure to inaugurate the first LNG handling terminal near Karachi, completed two years ago and since contributing 200-600mmcfd of imported LNG to the system — an achievement he claims credit for as petroleum minister and not as a prime minister.

He has issued directives to ensure a balanced mix of energy sources — a position his party has been claiming since it came to power four years ago without being able to reduce tariffs.

But the ‘balance energy mix’ is a fungible term that can facilitate an expensive plant and then balance it with another cheaper plant.

Importantly, the PML-N is left with limited time to change policy course on energy projects. It has already committed generation capacity addition to a level which the former managing director of the National Transmission and Despatch Company got sacked within weeks of describing as a ‘capacity trap’.

On ground, the roads leading to Mr Abbasi’s Islamabad residence were freshly carpeted before he could return home after his swearing-in. In a positive contribution to the people, a 30km main road in his home constituency Murree, that later links with the Azad Kashmir region, is also under repair after decades of neglect.

Also, he saw to it, while presiding over the first meeting of the reconstituted ECC, that two LPG Airmix projects earlier planned for Hajira and Forward Kahuta in Azad Kashmir are shifted to his Murree-Kahuta constituency in the Rawalpindi region. As petroleum minister he had pushed through, at the expense of natural gas consumers, the concept of 60 or so LPG plants in far-flung areas where natural gas provision is difficult.

In the absence of a major policy initiative over the month, the propaganda machine has been activated to articulate the prime minister’s focus on ensuring transparency, effective planning, human development and environment protection during his nine-month tenure.

It would be unfair to expect drastic functioning and policy changes in the final year of the party’s five-year tenure.

In fact, Mr Abbasi is under instructions from the party head to ensure continuation of policies and completion of projects launched during the last four years to deliver on promises before the next elections — with ending the energy shortfall on the top of the list.

Published in Dawn, The Business and Finance Weekly, September 5th, 2017