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The good and the bad news
By: Dr Abid Qaiyum Suleri

The good news is that Pakistan’s macro-economic indicators are improving. Both the IMF and World Bank have made an upward revision in their "GDP forecast" for Pakistan.

Country’s foreign exchange reserves are improving. Rupee appreciated against US dollar and it seems the rate would be stable around 100 rupees per dollar at least till the next budget. The fiscal deficit is contained as per target so far.

According to official statistics, inflation is contained, too. Current account deficit is swelling but it is still less than one per cent of GDP and quite manageable as one expects a boost in exports due to GSP plus status offered by the EU (export of many products of Pakistan on zero-tariff or on concessional tariff).

Injection of Saudi assistance, consistent flow of remittances and appreciation of Euro bonds (although the interest offered is almost double of what is offered by Greece for similar amount) have given some breathing space to the government. Its dependence on domestic borrowing is slightly reduced and this has been reflected through the fact that credit to private sector is improving.

New companies are being registered with SECP, and we are being informed that foreign investors are taking interest in investing here. Although the list of tax evaders is not made public but Pakistan has joined those few countries which have made the directory of tax payers public.

The finance minister is continuously urging the FBR for increased revenue collection. Barring few, Pakistan has fulfilled its major commitments with the IMF and the fund has given two clean chits to Pakistan in its periodic reviews.

One may disagree with some of the means used to improve macro-economic indicators; however, the finance minister should be appreciated for his clear-headedness. He is hardworking and makes his team to work hard. Through him, the PML-N is at least delivering on some of its promises on the revival of economy.

That the minister for planning, development, and reforms is clear-headed and has a vision, where he wants to see Pakistan in the years to come, is another good news. Ahsan Iqbal is trying to use Planning Commission to bring reforms on planning and development but, at times, feels constrained as his team does not seem to match his speed.
The socio-economic inequality is on the rise and middle class is fast eliminating, leaving two broad categories of Pakistanis: a minority which enjoys all privileges and is filthy rich; and a vast majority which is struggling to earn a square meal.

But lack of capacity in Planning Commission is not a horrifying news. The perception that planning and finance ministries are not at the same page is a disturbing news which may result in many useful plans remaining unfunded and vice versa.

One has to wait to see how the future vision unfolds. However, the bad news is that the people of Pakistan are still not able to reap the benefits of “macro-economic good news”. Although the prime minister ordered a reduction in fuel prices so that the effect of rupee appreciation may be passed on to common persons, there is no reduction in fares of public transport.

It is quite obvious that devolution of social sectors to provinces under the 18th Amendment was done hurriedly and without enough preparations. The recent “Education Atlas” produced by UNICEF and WFP is an eye-opener on the dismal state of education in the country and highlights the opportunities for public-private interventions in the education sector.

SDPI-WFP-FAO’s joint report on state of food insecurity is still not made public due to bureaucratic hurdles, but its analysis reveals that almost half of the population is facing caloric food insecurity. The report also highlights that despite improved production, socio-economic access to food is reducing on a consistent basis: a phenomenon which was also pointed out by the Supreme Court in its recent hearing of Liaqaut Baloch’s petition against increase in wheat prices.

Our performance on health is also part of the bad news. The most embarrassing is polio. The after effects of Dr Shakeel Afridi-OBL saga is that polio vaccination is considered anti-Islamic and “Zionist” tool by the self-righteous TTP and, thus, polio vaccinators are a regular target of militants now.

Inflation and reduced livelihood opportunities are yet other development challenges. We don’t know the exact population of Pakistan and we have no data available on people living under poverty line in Pakistan.

The socio-economic inequality is on the rise and middle class is fast eliminating, leaving two broad categories of Pakistanis: a minority which enjoys all privileges and is filthy rich; and a vast majority which is struggling to earn a square meal.

In fact, the last poverty assessment report was released by the Shaukat Aziz government, which was rightly challenged by Ishaq Dar (for under reporting poverty) in 2008 when he was nominated as finance minister under the PPP-PML-N alliance government. Since 2007, the government of Pakistan has not released official statistics on prevalence of poverty in Pakistan.

Our ignorance of climate change and environmental issues can be assessed from the fact that there is no ministry dealing with the issues of climate change (Please note, I have no false illusion that existence of a ministry would automatically take care of environmental problems).

Pakistan Protection Bill, if passed in its proposed form, would be another bad news, especially on civil liberties and human rights. The proposed “foreign contribution bill” would restrict the activities of NGOs and INGOs, especially stop their interventions in governance, democracy, and human rights. This would further taint the situation of civil liberties. The negative effects of ignoring the environment and human rights on GSP plus would be quite significant and immediately visible in the first post-GSP plus EU assessment report.

As a matter of fact, we need to have two separate strategies, one for "macro-economic growth" and the other for "micro-economic relief" so that the benefits of growth may be passed on at the grassroot level. Furthermore, it is not only important to have two distinct strategies but also to connect the two as it is not "growth" or "development" equation; it is growth and development equation.

A lot needs to be done to connect the macro level achievements and macro plans with realities at the micro level. However, the most important prerequisite is to come out from the state of denial when it pertains to our dismal performance on social sector issues.

By recognising the shortcomings on education, health, food security, gender, environment, and human rights, etc., we would certainly be able to devise relevant plans. A few of the bureaucrats need to realise that this time the king is willing to know the truth and would not mind being told when he has worn no clothes.


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The opinions expressed in this article are the author's own and do not necessarily reflect the viewpoint or stance of SDPI.