Interim govt slams economic growth framework

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The caretaker government on Thursday ordered the reintroduction of the 10th Five-Year Economic Plan thereby moving away from the Planning Commission’s Framework for Economic Growth.

According to sources, the decision was apparently rooted in a feud between two senior economists and did not have much to do with the country’s development plans.

The Prime Minister’s Finance Adviser Dr Shahid Amjad Chaudhry asked the Planning Commission to present the 10th Five-Year Plan which had earlier been shelved by the last government to him by next week.

Officials added that the advisor said that his government wanted to leave the 10th Plan (2013-18) for the next government to consider. During the meeting, Dr Chaudhry asked officials if necessary chapters from the FEG should be merged in the plan.

The FEG had been prepared by former Planning Commission deputy chairman Dr Nadeemul Haque, who was recently dismissed from his post by the caretaker government.

When Dr Haque became the deputy chairman, the Planning Commission had been preparing the 10th Plan for 2010-15, which he ordered shelved. In its place, he proposed his own strategies for economic development. The FEG was later approved by the National Economic Council. However, the FEG was never implemented and lacked broader acceptance.

The 10th Five-Year Plan (2010-15) aligned with the growth models the country was implementing, advocated the status quo. It had envisaged 7% growth, increasing literacy to 65% and reducing the incidence of poverty.

The Plan’s main focus was to move gradually towards increasing investment in education and health and improving living standards. The Plan had also promised to usher in an era of development in underdeveloped parts of the country.

The plan’s goals included the reduction of infant and maternal mortality rates, mobilising resources, improving the security situation, addressing the energy crisis and improving management of the public sector enterprises.

On the other hand, Dr Haque had presented the FEG as a new approach towards accelerating and sustaining economic growth. The strategy was based on sustained reforms that would build an efficient governance structure, and create markets in desirable and well-connected locations.

“The country will look terrible if we do this,” Dr Haque responded when told that the FEG may be scrapped. He said the FEG had been approved by the National Economic Council, while the 10th Five-Year Plan was merely a draft document put together by the current finance adviser’s brother, Dr Rashid Amjad, in the latter’s capacity as acting chief economist at that time.

Dr Haque had restricted Dr Amjad to the Pakistan Institute of Development Economics as vice chancellor of the institution, when the former assumed charge as deputy chairman of the Planning Commission.

Dr Haque said the interim government should not overturn the National Economic Council’s decisions, especially when a new government is about to be formed. He said only the National Economic Council can reject the FEG, and there must be a discussion prior to such a decision. He said the finance adviser was not above the National Economic Council, and the apex body had not approved the draft of the 10th Five-Year Plan. He further said that the law and rules must be followed before the government takes any decision on the FEG and the 10th Plan.