LAHORE: Speakers at a ThinkFest session were unanimous that the so-called accountability, IMF package, mismanagement and poor law and order situation are the reasons for low investment and decline in export-led growth and unemployment.
They said the leading economists must come forward and gave a viable plan to the government for taking the country out of the debt-driven economy.
“I will list some of the reasons that are creating hurdles in the way of country’s economic growth. These include poor law and order situation, so-called accountability and weak governance. In a situation where an officer of grade-17 silently works and retires in grade-22 without doing any extraordinary work and those who do hard work honestly are caught by the NAB, who will dare invest in our country,” deplored Miftah Ismail, former federal minister for finance, revenue & economic affairs.
He was speaking at the session titled “Pakistan and its economy: why is it always muddling through?” here on Sunday.
The session was moderated by Savail Hussain and other panelists were economists Hafeez Pasha and Salman Shah.
Miftah Ismail, others spell out reasons for low investment
Mr Ismail said Pakistan was not competing with its neighbouring countries as India and Bangladesh have the growth rate of 7 and 6.5 per cent, respectively. Similarly, Sri Lanka too is ahead of Pakistan.
He said the law and order situation was better today than it was in 2013 but the foreign investors were still afraid of investing in Pakistan. Moreover, he said, getting visa for Pakistan from other countries was the most difficult task.
“Governance is another issue and we don’t encourage the local government system. The officers who work honestly are caught on the pretext of accountability. Mismanagement also exist in the power sector as no one worked for exploring local natural gas. Our ceramics industry has almost collapsed owing to unavailability of gas. At present, we are importing tiles from China,” he said.
In order to bring the economy in the right direction, he said, we would have to understand the triangle and linkages of tax, growth and investment.
Hafeez Pasha recalled that the last regime (PML-N) initially faced problems but later it controlled the situation that increased our foreign reserves and helped reduce dollar exchange rate to Rs105.
“It happened after the government did massive borrowings in three years that caused a considerable growth in our imports and that further led to enhancing the current account deficit at a peak level in the financial year 2017-18,” he said.
He said Pakistan’s economic story was based on money coming from abroad (remittances, loans, support funds etc). “If the money continues coming, we have good days and if not, we see bad days,” M Pasha said.
He said the war on terror damaged the country’s economy as it cost US $225 billion. But the country received only US $30 billion, he said.
BELT and ROAD: In another session titled “Belt & Road: A Chinese World Order”, the panelists were of the view that the member countries of China’s Belt & Road initiative joined it voluntarily and not under any pressure.
“Sixty-five countries have become partner of China’s project. And they have done this voluntarily,” Masood Khalid, former ambassador to China, said.
As for the CPEC, he said China didn’t dictate anything to Pakistan keeping in view the time-tested relations between the two countries. “There is a win-win situation for both countries over CPEC’s execution,” he added.
FISCAL DEVOLUTION: A panel spoke at a session titled “Will provinces bankrupt the centre: fiscal devolution post 18th amendment”.
Dr Ayesha Ghaus-Pasha said the 18th amendment didn’t make the federal government economically weak. “If we review this, we find that it has only caused a difference of 1.5 per cent in the share of the federation and nothing more,” she claimed.
However, Punjab Finance Minister Hashim Jawan Bakht, Minister for Revenue Hammad Azhar and KP Finance Minister Taimur Jhagra said there was a need to strengthen the federation first.
PRISON DIARIES: Miftah Ismail who remained in the jail and NAB custody for about six months, denied the allegations levelled against him, Shahid Khaqan Abbasi and others over the LNG deal with Qatar and construction of an LNG terminal in Karachi.
“When I asked them to show me the LNG deal of any country that is made cheaper than Pakistan’s, they couldn’t do so. And when I asked to show me the cost of any terminal cheaper than the one we got constructed, they had no answer,” he deplored.
He criticised the government and the NAB for victimising the country’s brains who contributed a lot.
Published in Dawn, January 13th, 2020