27 October 2013

Economic Explosions of PML-N Government

Courtesy: The Lahore Times

Those were the days of electrifying election campaign, when the passions were heated up. There was a war of words between PML-N and PTI leadership. Imran Khan was chanting the slogan of change and revolution, whereas Nawaz Sharif was talking about changing the country with the help of his experience. During election campaign, Nawaz Sharif said while addressing a crowd, “We carried out nuclear explosions in our last government and this time we will carry out economic explosions.” Now, Nawaz Sharif has been prime minister for 120 days and we know what he was talking about. We have heard the massive sounds of the Economic explosions which have taken place in last four months.

Nawaz Sharif is a very experienced politician, before this term, He had been Prime minister twice and also held the office of Chief Minister of Punjab on two occasions. There was a general belief that Nawaz Sharif can overhaul the economy of Pakistan through his experience and with the help of competent team. It only took Nawaz Sharif and team four months to shatter all the dreams of common Pakistanis, who had mistakenly thought that there would definitely be betterment in their lives, if elder Sharif became the prime minister. The first anti-people decision of PML-N government was to announce a budget without any increase in salary for government employees. Later on, government was compelled to announce a 10% increase after protests from All Pakistan Clerks association. It would have been a gross atrocity to not increase the salaries when the surge in inflation has been unprecedented. This small decision shows how much common people matter to the new regime. The PPP government increased salaries of government employees by over 150% through the course of five years.

PML-N is considered to be a party of businessmen and this government is alleged to be the representative of business class, and it has lived up to that reputation. This government paid 480 Billion rupees to IPPs to clear the circular debt. This act must not be criticized because it was taken for the benefit of people and it increased electricity supply by 1700 Megawatt, Right? Yes, that’s true, but the manner in which the large amount of some was collected and distributed, is where the problem lies. There are some allegations that one or more than one Federal Ministers have shares in IPPs, in such a case it would be a huge conflict of interest if the same federal minister decides to release money for his own company. Another matter that has gone unnoticed is that PML-N government also used the 62 Billion Rupees of Universal Service Fund to clear circular debt. This fund was constituted to provide communication services to remote areas of the country and to bring them at par with big cities in terms of communication technology infrastructure. PPP government also hinted about using this fund for Benazir Income support program but the ideas was dropped after criticism in media. Now this government silently used that fund and no one noticed, apart from few investigative journalists. That was definitely a massive Economic Explosion.

The primary testing site for PML-N’s Economic explosions are 31 government run corporations which are announced to be privatized. PIA, will be the first to feel the burnt of Economic explosions of the current regime. It has been announced that 26% shares of PIA will be privatized along with its administrative control. There are many big sharks that are eyeing the PIA and want to purchase it very badly. If this deal went as announced then PIA will be sold cheaply and someone in government will make huge amount of money in the form of Kickbacks. There is no doubt that PIA is in heavy losses and it requires remedy. However, Privatization is not the answer and National Flag carrier is not even privatized in banana republics. 30 other government corporations which are in loss due to mismanagement and corruption can be converted into profitable corporations, if the government has the resolve, which doesn’t seem to be the case. One can imagine how much money will be made in the form of kickbacks when all the government corporations are privatized and no prize for Guessing that who will get the money. That economic explosion will surely be unprecedented in history of this unfortunate country.

How can I forget the failed economic explosion of increasing the electricity prices. PML-N was all set to carry that economic explosion, but Supreme Court diffused that bomb at the last minute. It’s understandable that government can’t afford to continue subsidizing electricity consumers but this reduction could have taken place gradually in phases. Another issue in this regard is that, why the government is hell bent on making the under-privileged classes of society sacrifice for economy and letting the elite class go scot free. We know that rich don’t pay tax in Pakistan but Nawaz Sharif’s government is not doing anything substantial to ensure an end to that practice. Reason for this is that PML-N itself is made up of and supported by such tax evaders, then how can it go on about taxing them?

PPP government set unprecedented records of corruption and no one can deny that. PPP government, throughout their tenure, maintained that they have inherited Economic troubles from Musharraf government. Now PML-N government is playing the same music. It can’t hide its failure by complaining about inheriting a broke economy. It has to take responsibility for its share of flawed policies and decisions. It has the mandate to run the government for 5 years and now it has only been 4 months but it has to show some positive signs, which are missing until now. The economy of Pakistan is in a very fragile condition and can’t bear the proposed economic explosions of PML-N. In the greater interests of people of Pakistan, PML-N should take concrete steps to give some economic relief and avoid further economic explosions.

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