Published Date: Jun 7, 2014
Despite claims & successes, common man waits for trickle down benefits
Despite reduction in the dollar-rupee exchange rate, increase in exports and foreign exchange reserves, the first year of PML-N government could not bring any positive change in the life of the common man.
some experts are praising the government for improving macroeconomic indicators, poor Pakistanis are still waiting for trickle down economic relief promised by Pakistan Muslim League-Nwaz while assuming power in June 2013.
During the first year, the prices of electricity and petroleum products have gone up resulting in overall hike in the rates of almost every household item. On the other hand, the
crippling load-shedding and shortage of CNG continued to haunt ordinary
Pakistanis during the year.
When the PML-N took over, it promised to reduce power outages through drastic measures, but the situation only improved slightly for some weeks despite payment of Rs480
billion to power producers on account of circular debt.
introduction of 3G and 4G phone spectrums is being considered a belated
but good move by the government which will have long term economic benefits for the country apart from generating $1.1 billion revenue from
the license auctioning.
According to Institute of Policy Reforms (IPR), an independent economic think tank, the government missed
many of the economic targets for 2013-14, including GDP growth rate, rate of inflation, PSDP spending, foreign direct investment (FDI) and export growth.
It says the target for FBR revenues was Rs2475 billion, but the actual revenue is projected to be Rs2,275 billion. Similarly, export growth is projected to be 2.4% as opposed to the target of 5.1 %.
According IPR calculations, the actual growth rate of GDP in 2013-14 is close to 3.5% while the government claims it to be 4.1 percent. IRS questioned why the inflation
did not decrease after depreciation of dollar against rupees?
“The effects of revaluation (of dollar) seem to have vanished in a month,” it added.
economic think tank believes the government’s claim that there has been
improvement in the business climate is not reflected in the level of private investments which has fallen by 1.6 percent in July to March 2013-14.
“The growth rate of large scale manufacturing industries has come down from 5.3% in July-Feb 2013-14 to 4.3% in July-March 2013-14.
The Executive Director of Sustainable Development Policy Institute (SDPI), Dr Abid Qaiyum Suleri, believes the
government’s overall economic direction is right.
external factors have contributed in improvement of Pakistan’s economy during last one year. These factors include no flooding during last monsoon season, resumption of coalition support fund, IMF loan and Saudi
support etc,” Dr Suleri said.
He said the foreign exchange reserves have increased and domestic borrowing of the government has decreased during first year of PML-N in power.
a question, he said Pakistan has also managed to obtain EU’s Generalised Scheme of Preferences (GSP+) Plus status last year, but it will take some time to bring positive effects on Pakistan’s economy.
negative side, he said the prices of fuel and electricity have gone up during this period. “The government could also not make a significant progress on its privatisation plan while it has also failed to bring foreign direct investment,” he said.
“In short, we can say
macroeconomic reforms could not connect to microeconomic reality,” he said and added the key question is to what extent the government will be
able to implement the policies announced in the proposed budget for 2013-14.