ISLAMABAD, Feb 15: As electioneering enters the final stages, economic discontent on the back of skyrocketing prices and decline in employment in the formal sector has emerged as a major issue for the leading political parties.
This shift in focus away from issues like terrorism and militancy has taken place in the wake of economic policies of the last eight years, which have resulted in a widening gulf between the rich and the poor. The Feb 18 general election is the first since 9/11 in which the economy features in various parties’ platforms as much as militancy if not more.
To be sure, mainstream parties are not the only ones which are focusing on economic issues.
A recent survey carried out by the statistics division on the labour force revealed a 10 per cent drop in employment in the formal sector, while the number of unpaid family workers increased during the last three years. Employment generation was limited largely to the informal sector.
An analysis of data showed that the decline in formal sector employment was greater for women in comparison to men in the last couple of years. On the other hand, the participation of women in the informal sector rose during the years under review.
Another report shows that the number of earners per household has dropped — both in the urban and rural areas. As the household size increased, the number of earners declined, indicating an increase in unemployment despite official claims that joblessness had been sliding in the last few years.
The prices of goods ranging from wheat to edible oils have soared. The shortage of electricity and gas has forced factories to cut their working hours and households to do without power several hours each day. And a combination of higher prices, shortages and political unrest is heightening a sense of crisis in the country.
The increasing costs of energy, health care and education, besides rising rents and overall inflation, are being described frequently in the election rallies of the opposition parties as the nation’s biggest economic problem.
For the future government, it will be important to create a public partnership in the affairs of the state through free education up to the matriculation level and cost-free basic health for every citizen.
Official figures show that growth in industrial production has been declining steadily in recent years. It declined to 8.8 per cent in the year 2006-07 from 19.9 per cent in the year 2004-05, owing to capacity constraints and closure of many units due to the high cost of doing business. In the current year, it will be difficult to reach even last year’s manufacturing growth target.
According to some political pundits, the country’s performance in the trade sector has also become a major issue as the country witnessed the highest trade deficit of more than $13 billion last year.
They argue that huge deficits have contributed to the loss of thousands of jobs since 1999.
This year the trade deficit is set to cross the $15 billion mark. Not a single textile unit has been established in the country in the last few years. The industry has a 66 per cent share in exports.
Independent economists say people’s personal financial concerns range from health-care and education costs to jobs. The poor Pakistani simply doesn’t have enough to get by. Due to the recent rise in inflation, the income of the average family is declining even further.
However, the Musharraf regime’s proudest boast used to be its economic record, delivering annual growth rates of around 7 per cent for the last five years. But now inflation and shortages have made the economy the biggest handicap for pro-Musharraf parties.
Sakib Sherani, the chief economist for the ABN Amro Bank, said the gradual erosion of macro-economic stability and rising inflation has provided the opposition parties with an opportunity to attack the government’s policies. He said: “Given the challenging economic backdrop in the last few months, it is politically astute of opposition parties to try to get the most out of this. We have seen a shortage of essential commodities, high prices, power load-shedding and energy shortage.”
The key pillars in the manifesto of the Pakistan People’s Party are rapid economic growth, combating unemployment, targeting poverty, accelerating agriculture and rural growth and ensuring water security and energy infrastructure.
Among other key economic issues, it also talks about containing inflation which is hurting low-income groups, and putting in place innovative programmes to create jobs in the public and private sectors. The manifesto goes from improving labour wages to increasing industrial and farm productions.
The PML-N manifesto characterises the economic policies of the government as pro-rich. It talks about a package for the poor and focuses on expansion in employment opportunities to over three million people in the public and private sectors.
The party has also drawn up a plan for controlling rising inflation, increasing farm production to overcome shortages of grain, and development of the shrinking manufacturing industry.