ISLAMABAD: Opposing a decision of the government of his own Pakistan Tehreek-i-Insaf to increase taxes on items of daily use, former finance minister Asad Umar on Thursday called for an investigation into a constant increase in sugar prices.
Taking part in the debate on the budget in the National Assembly soon after the speech of a subdued Asif Zardari, who attended the sitting for the first time since his arrest by NAB on June 10 after issuance of his production order by Speaker Asad Qaiser, Mr Umar asked the government to reconsider the decision to increase tax on sugar, ghee and cooking oil and impose Federal Excise Duty (FED) on small cars.
Mr Umar, who was removed from the post of finance minister weeks before presentation of the budget and in the middle of the talks with the International Monetary Fund (IMF), said it was inappropriate to increase tax on sugar as its prices were already on the rise.
“This (rise in tax on sugar) should be taken back and there should be an investigation as to why sugar prices are already on the rise,” Mr Umar demanded.
He also disclosed for the first time some of the details of his talks as finance minister with the IMF and claimed the credit for making the Fund agree to soften its tough conditions for the bailout package.
A subdued Zardari asks govt to sit with opposition & move forward on economic policy; PPP, MQM trade barbs in NA over Sindh issues
The brief presence of Prime Minister Imran Khan and a verbal clash between the members of the Pakistan Peoples Party (PPP) and the Muttahida Qaumi Movement (MQM) over the matters related to Sindh were the other highlights of the daylong proceedings.
Mr Zardari’s daughters Bakhtawar and Aseefa were present in the galleries when he delivered a brief speech focusing only on the budget. He was greeted by the opposition members when he entered the house with his son and PPP chairman Bilawal Bhutto-Zardari.
The Pakistan Muslim League-Nawaz’s firebrand MNA Khwaja Saad Rafique, whose production order was also issued by the speaker on Wednesday night, reached the assembly from Lahore at the fag end of the day’s proceedings.
The house also witnessed a few verbal skirmishes between the government and the opposition when the members from the two sides during their speeches made personal attacks against the leadership of each other, forcing the chair to expunge a few words from the proceedings.
Two senior ministers — Shafqat Mehmood and Ghulam Sarwar Khan — in their speeches mainly targeted the opposition parties, particularly the PML-N, instead of discussing the budget.
Aviation Minister Ghulam Sarwar Khan, who was given the floor during the presence of the prime minister, earned the ire of the speaker when he objected to his decision of issuing a production order for Mr Zardari, saying that the speaker was bound to ensure the presence of the arrested members only during voting on the budget.
An angry speaker reprimanded the minister saying he had discretionary powers to issue production orders and was not “bound to anyone in this regard”. He switched the minister’s mike off when the PML-N members protested over his remarks when he started naming PML-N leaders, accusing them of receiving kickbacks while awarding contracts of major development projects.
Asad Umar’s speech
The former minister lauded the new economic team of the government for presenting a “budget for tough times”.
Mr Umar, who is presently heading the house committee on finance, said the turnover tax should not be imposed at least on new investments for five years. Similarly, he said, the decision to levy Federal Excise Duty on small cars should also be reviewed to provide benefit to the middle class people.
Mr Umar recommended that there should be a further increase of 10 to 15 per cent in pensions. He advised the government to either withdraw the gas infrastructure development cess on fertilisers or make arrangements to recover it from the owners of the factories who were collecting it from the farmers, but not depositing it to the government’s kitty due to some litigation on the issue.
Mr Umar said now when he was no more a minister he could disclose some of the details of his talks with the IMF. He said there were five main factors — electricity prices, gas prices, tax rates, policy rates of State Bank of Pakistan (SBP) and rupee devaluation — which were discussed during negotiations with the IMF before his “resignation” from the cabinet.
He said the IMF wanted an increase of 50pc and 94pc in the prices of electricity and gas, respectively. However, he said, the National Electric Power Regulatory Authority had recommended an 11pc increase in electricity price, saying there might be three to four per cent further increase in it.
He claimed that it took him four months to make the IMF agree on one-fourth of the 94pc suggested increase in gas price. He said he was happy to see that the SBP governor had already announced that there would be “flexible exchange rate” in the country, instead of “free float.”
Mr Umar said the IMF wanted the government to increase the policy interest rate from 9pc to 15pc. Similarly, the IMF put a condition that the tax-to-GDP ratio be brought to 13.2pc, which the government now intends to bring to 12.6 per cent.
Surprisingly, Mr Zardari in his first speech since his arrest did not target the National Accountability Bureau or the prime minister and suggested that the government and the opposition should sit together and discuss an economic policy “to move forward.”
“Let’s give the economic policy [collective] ownership so that it continues forever,” said Mr Zardari who was the first speaker of the day.
“If the budget is so good and if we are getting money from the IMF then why are people crying? Why are industries crying?” he asked.
He said his party leaders had rendered sacrifices for the cause of democracy and he also raised slogan of “Pakistan Khappay” after the assassination of his wife and former prime minister Benazir Bhutto.
Mr Zardari said when they assumed power after a military rule, they did not victimise any politician. He said detention was not new for them, saying: “I used to come to the assembly from jail in the past too.”
He said there was so much fear among businessmen and investors that they weren’t ready to invest in the country.
“Arresting me doesn’t make any difference to the party. The PPP is further strengthened,” he said, adding that an ordinary person was worried that if Zardari sahab could be caught, then what next.
He warned that the entire country might protest because of these measures (arrests) and then no political party would be able to do anything.
Taking part in the debate, the MQM’s Salahuddin said Mr Zardari who was known as “Mr 10 per cent” had now become “Mr 100 per cent”.
He said his party had voted for the 18th Amendment, but the people of Sindh were not getting any benefit out of it. He alleged that the Sindh government was not spending money on welfare of the people which was evident from the dilapidated condition of the cities. He said there was not a single model union council in Sindh where people were not forced to drink contaminated water. He said even the Supreme Court had declared that Sindh was the most “corrupt province”.
Mr Zardari, who had gone to the opposition lobby after delivering the speech, returned to the house and responded to Mr Salahuddin, alleging that the MQM had made Karachi hostage during Gen Musharraf’s regime. He said the people remembered how the MQM asked the people to purchase weapons. The MQM people were crying because they had now been left as “orphan”, he added.
Published in Dawn, June 21st, 2019