Even 4.7 pc seems doubtful
Sadly, the only news the budget brings is how badly the government fell short of achieving almost all important indicators. And how the under-performance does not unnerve it at all, and it sets even higher targets for the new fiscal.
That is true for all governments. The PPP did the same. In fact, when Hafeez Sheikh became finance minister – after Shaukat Tareen left to tend to his bank – he forgot all about his previous association with the Musharraf government, blamed all the problems on the floods and even shouted Jeeay Bhutto at the end of the budget speech. And, of course, he set higher targets that were never met.
The agriculture collapse puts a big question mark on the government’s performance. This sector employs 40pc of the country’s workforce. And till not too long ago it used to be self-sustainable. How could it be allowed to cave in so badly?
Things weren’t much different before the return to democracy. Once Shaukat Aziz read the budget speech before a camera – since there was no parliament at the time. The following hear he read it in the House, but in Urdu, and made a joke of it. So the next year they gave the job to Umar Ayub; who read it fine but kept up the denial routine. Then he set yet higher targets that were not achieved.
So, over the years, the budget lost its sanctity. It became an insignificant document presented by irresponsible politicians. They are, all of them, guilty of a dual offence – falling short on targets, then setting even more unrealistic ones.
That is why this year’s budget was not surprising. It was, if anything, pretty much what happened last year. Only agriculture got special attention just because it went through the floor – posting -0.19pc against the targetted 3.9pc. Other than that nothing’s changed really. The tax base is not going to expand in the near future, so everybody can start preparing for more sudden indirect taxation that had no mention in the budget. And obviously nothing is going to happen about exports. So revenue will more or less depend on remittances and unorthodox initiatives typical of Dar sb.
Print struggles to get hold of heavy weights immediately after the budget speech – since they bee-hive to talk shows – but rising PPP star Saeed Ghani has always been very generous with his time. As the budget became the latest point of controversy between the government and opposition, he talked exclusively to DNAabout the speech, the government and PPP’s revival.
How could exports have performed so badly? What did they make of the GSP Plus formula that gives them preferential EU access? Shouldn’t growth have increased? These facts make the 4.7pc figure a little hard to digest as well
Question: Why the haste in rejecting the budget? The government is now saying you had come prepared to reject. You could have thought it over a little longer, couldn’t you?
Saeed Ghani: Budget content is hardly a state secret anymore. Everybody knew what was about to happen for three to four days now; hence the quick response.
Also, there is a trend in this government’s budget speeches. They tend to forget their promises very quickly. For example, remember how Dar sb claimed the government would build 500,000 houses for the poor? We questioned then, that at the mentioned rate of disbursement the project would take fifty years. But then nothing happened. If you know what became of those houses please do enlighten me.
And that is not all. They just like to make tall claims; make headlines basically. The kisaan package is a good example. It wasn’t too long ago so people should remember it. They gave Rs341b to the agriculture sector. But did that make any positive difference? Did the agriculture sector benefit in any way? Do they even realise that their direction is not right? If you go by their budget speeches, they clearly do not.
Things were very different in our time. Even after the floods agriculture survived. We took proactive steps like raising support prices and providing timely incentives. Do you remember the sugar and wheat shortfall before our government came? We not only corrected that, but produced a wheat surplus to the point that we were exporting it again.
Q: Where, then, does the problem lie? What is PML-N doing wrong?
SG: The N-league suffers from a serious priority deficit. Their development policy spells it out. What sort of government focuses on motorways and Orange Lines when agriculture, the traditional comparative advantage, is in red?
They go for high visibility projects that touch a few cities at the most. Despite their third time in power, and after so many years in Punjab, they have still not turned their attention to basic problems in the periphery. People dying in villages benefit very little from mega projects in urban centres.
The agriculture collapse puts a big question mark on the government’s performance. This sector employs 40pc of the country’s workforce. And till not too long ago it used to be self-sustainable. How could it be allowed to cave in so badly?
And it’s not just about soft commodity prices in the international market. Our cotton production was down 28pc this year. Was this because of the international market? This is no joke? Our main centres of production are going waste and the government acts as if it has achieved an economic miracle.
How could exports have performed so badly? What did they make of the GSP Plus formula that gives them preferential EU access? Shouldn’t growth have increased? These facts make the 4.7pc figure a little hard to digest as well. How could growth be near five percent when earning is so obviously compromised?
Q: What relevance does the budget document really have when no important targets are achieved and the government enforces measures mid-way through the fiscal?
SG: It will lose relevance, of course, when the government itself does not take it seriously. Acts like imposing customs duty on a number of items last December, or charging 50pc GST on fuel, do not leave much sanctity in the budget document itself.
Ideally opposition parties should present shadow budgets. That not only backs their arguments, but also provides an important barometer for the government. Sadly such things are not known to happen in our parts.
But, yes, the budget has become less relevant with time. Why do you think opposition parties rejected it so quickly? It is strange, though, that despite performing so poorly the government still acts as if it has done a great job and expects miracles next year.
Q: What about the PPP? How does the party evaluate its revitalisation efforts? And how does it view the prime minister’s present and future standing?
SG: PPP is undergoing a pretty thorough overhaul at the moment. And it’s unfair to say, as many have done, that these efforts have been unsuccessful.
They are directed at turning the party around. It’s a big party and a big internal structure; spread across the length and breadth of Pakistan. Expecting immediate results would not be realistic. Yes we are doing many things, but all that is in preparation of the 2018 election. So things will become clearer as the election nears.
As for Nawaz Sharif, I’ve noticed that he’s become increasingly weak since 2013. And, going by the looks of things, he’s likely to get weaker in the two years remaining in this cycle.
He becomes easily unsettled when faced with crises, and then makes rash and unwise decisions. Morally, he’s already lost a lot of ground. So, things are not getting much better for the prime minister anytime soon.
