KARACHI: The Pakistan Peoples Party (PPP) vowed to review all free trade agreements (FTAs) Pakistan has entered into thus far if it comes into power after the election “to create a level playing field” for industry and agriculture.
In its manifesto for the elections 2018, the PPP also severely criticised the PML-N government “fictitious growth story”, saying “the outgoing government is leaving our country saddled in copious debt, alarming external trade and balance positions, unsustainable public finances and more exclusions.”
It promises a series of reforms for water, energy, trade, industry, agriculture and energy revitalisation, some of which sound pointed whereas others speak in generalities. For example, in trade the manifesto says “efforts will be made to promote trade within the region by separating trade from other geopolitical considerations”, a clear reference to India, with which the party came close to normalising trade relations in its previous stint before backing away for undisclosed reasons at the last minute.
Other than this, it promises to restore zero rating for export oriented sectors of the economy, payment of all rebates, “provision of electricity at subsidised rates”, and “maintain a market based exchange rate” as measures designed to breathe life into Pakistan’s exports.
For industry, the manifesto promises a rehabilitation scheme through the State Bank for “revival of economically viable but closed sick units” and “viable tariffs on electricity”. It also promises to diversify the industrial base of the economy through directed credit programs through the State Bank, adding these will be time bound and performance based.
In the energy sector, the manifesto points to renewable sources of energy as a priority, saying the party will aim to raise the contribution of renewable energy in the total energy mix to 5 per cent through “adequate incentives”. It also promises to complete Diamer Bhasha dam, and eliminate the circular debt “by focusing on the drivers of the circular debt, as defined in the National Power Tariff and Subsidy Guidelines 2014”. It also calls for provinces to have their own transmission and distribution grids.
The manifesto promises gas pricing reforms to move toward “economic valuation of indigenous production” and “reform of price concessions and subsidies to serve only the poorest among domestic consumers”. The language appears to suggest a broad based rolling back of gas price subsidies. It also emphasises provincial ownership of gas resources “and the accrual of their true value to provinces”. The majority of Pakistan’s natural gas is produced in Sind and Balochistan.
It aims to advance digital payments through a new regulatory framework, elimination of duties on machinery and equipment required for the industry’s core operations, tax incentives as well as pushing the flow of credit to the sector with the help of the State Bank.
For state owned enterprises, the manifesto only promises independent boards and “engage public private partnerships” for investment. It promises to set up a task force for SOEs, as well as a Joint Parliamentary Committee, composed of members from all political parties, to develop a National Economic Agenda.
Published in Dawn, June 30th, 2018