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The Express Tribune

Published Date: Dec 10, 2015

Eliminating inequality: Experts call for debate on fiscal policies

Focus on fiscal policies of South Asian countries can serve as a major step towards eliminating inequality in the region, economists and social experts said on Wednesday.
Speaking at a session on rising inequality in Asia and role of fiscal policies to reduce inequalities, the speakers focused on how South Asian countries can work together on a mutual issue.
According to Former Finance Minister and member of the board of directors of Centre for Policy Dialogue, Bangladesh, Dr Muhammad Syeduzzaman, the fiscal policies and deployment of public resources is essential for development of human capability, reduction of poverty and inequality and increase in productivity.
“We have observed that since the economy is closed in rural areas, setting up primary health care, education and sanitation reduces the per capita expenditure for rendering the services and also imposes workforce indicators,” he explained.
According to Syeduzzaman, institutions which influence public expenditure and fiscal policy, at times, leads to alleviating monetary resources for non-priority projects and raises cost of doing business, which should be avoided.
He further said that all South Asian countries should reduce inequality by increasing GDP growth rate and the first goal should be to raise more domestic resources.
“Raising the GDP ratio by redesigning and rationalising the tax system and improved efficiency in collection mechanisms can also help reduce inequality,” Syeduzzaman said.
According to Auditor General of Pakistan Rana Assad Amin, Bangladesh is a model for developing countries as a whole and it has done exceptionally well in reducing poverty.
“But our human development index has unfortunately remained stagnant for the last five to six years and we have transitioned from ‘medium’ to ‘low’ level of human development. It is a tragedy for Pakistan,” Amin added.
Speaking of adopting the right path to economic development Amin stated that though China is considered a model country in terms of growth what people tend to overlook is the increase in inequality in the country.
Economist and social development expert Alya Majeed said that while running a country somebody has to take the leadership role and devise strategies and policies to fulfill the agenda for everyone.
“In order to do so there has to be a balance between earning revenue and then spending it on the stakeholders,” she added.
Executive Director Institute for Social and Economic Justice and Focal person for third world debt Syed Abdul Khaliq shared that all the new research suggests that despite development social and economic inequality is rising around the world.
“I think the issue of inequality is equally worrisome for the rich because it not just threatens social and political stability of the world but also pose a threat to financial stability in terms of its likelihood to create more deadly conflicts around the world,” he added.