But still no direction
According to Finance Ministerv Asad Umar the government is now in the ‘final stages’ of negotiations with the IMF for a bailout package. This is in stark contrast to a statement he made only two months back, saying the government was not going for an IMF programme for now. Before taking power, the PTI had made bold promises of not approaching the IMF at all. Such mixed signals about where the government is planning to take the economy, have done a lot more harm than good. By default each new government blames the previous one for the mess it inherits, but that defense can only last for a few months after which responsibility lies solely with those in-charge, who are expected to provide a sense of direction. Seven months gone and the direction remains absent.
Loans from friends have brought some stability, but this is temporary because our expenditures have not reduced as significantly as the dollars have flown in. At present it takes around $1 to $1.5 billion a month to pay for imports and service existing debt. At this rate we will burn through the foreign support in a few months. On the revenue side the situation is not much better. The FBR is still being run the same as before, with the focus set on squeezing existing taxpayers without formulating a policy to bring into the net the vast majority of non-taxpayers who are easily able to remain below the radar. At the centre is the Finance Minister who seemingly entered this minefield with no plan, although he had been chosen for the position much in advance of his party coming to power. His recent unnecessary spat with PPP Co-chairman Bilawal Bhutto concerning the latter addressing Parliament in English rather than Urdu, not to mention an objection over which of his parents’ last name he uses, displays Umar’s sense of priorities. Claiming that losses in the electricity and gas sectors will be recovered from the accounts of Zardari and Sharifs shows his depth of thought regarding serious problems. Mr Umar’s sole focus needs to be the economy as there is no time to waste. His politics can wait!
