KARACHI: “Due to actions taken by the government, four million people were poorer and one million were left unemployed by the end of 2018 and the outcome will be the same by the end of this year too as the economic growth is half of the rate of inflation here,” said economist and academician Dr Hafiz A. Pasha during the launch of his book Growth and Inequality in Pakistan; Agenda for Reforms organised by the Social Policy and Development Centre (SPDC) and Friedrich-Ebert-Stiftung (FES) Pakistan at a local hotel here on Friday.
Discussing economic policy and reform in Pakistan, he said that the country had no other option but to go for reforms; however the way they had gone about things had created more issues than resolving the old ones.
About his book, he said that it was a culmination of years of research and focused on two structural deficiencies: “Low economic growth and higher and pervasive inequality, which has remained that way for the past many years.”
He said that there was taxation on basic goods and services, which was the worst thing in this year’s budget. “We are taxing ghee, CNG, slippers. Around 75 per cent taxation proposals relate to indirect taxes here. Why not instead focus on direct taxes?” he asked.
“We can certainly pay agriculture tax. The industry generates 70 to 80pc revenue and thus the industry and small businesses should not be heavily taxed. I totally disagree with the tax strategy,” he added.
He spoke about things going against the country such as the cost of loadshedding, terrorism, green growth, meeting of Sustainable Development Goals and state capture by the elite. “There are special privileges enjoyed by the feudal elite, the military establishment, the corporate sector, etc. Meanwhile, there is the hardworking salaried folks, the workers, the industry, etc, that is being squeezed dry. But the elite should realise that it is in their own favour to turn down the privileges so that the country can prosper, as they will prosper with their county,” he said.
Commenting on the book, Dr Samina Khalil, director of the Applied Economics Research Centre at the University of Karachi, said that it could help turn around the country’s economy. “Social scientists and policymakers in Pakistan can really benefit from it,” she added. She also said that Dr Pasha was the best economist in the country and a teacher par excellence on top of that. “He is the best scholar and teacher who leaves a lasting impression on colleagues and friends,” she added.
Mohammad Sabir of SPDC said that no reform agenda was complete unless fiscal stability was targeted.
Industrialist Dr Mirza Ikhtiar Baig said that a reform agenda was the need of the hour. He also commented that there was a lack of coordination in the government which was making things worse for the country’s economy instead of making things better.
Former senator and federal minister Javed Jabbar said that Dr Pasha’s book carried great reference value. “It includes verified credible data and comprehensive survey of Pakistan’s economy and society,” he concluded.
Asif Iqbal of SPDC and Abdul Qadir from FES also spoke.
Published in Dawn, September 22nd, 2019