Finance Minister Ishaq Dar giving away souvenir to participants of budget seminar. PHOTO: NNI
Speaking at a pre-budget seminar, Dar also came down hard on his biggest critic, Dr Ashfaque Hasan Khan, terming him a “spin doctor”. He also accused Khan of misrepresenting the facts to get personal benefits.
The outbursts came just a day after the National Accounts Committee approved 4.7% gross domestic product (GDP) growth for the outgoing fiscal year 2015-16, ending on June 30. The government had aspired to achieve 5.5% growth target, which it missed for the third consecutive year.
Govt misses most critical growth target amid suspicion
Dar defended the setting of what he called “overstretched targets”, advising his critics to see the progress made thus far instead of focusing on missed targets. The minister said a decrease in cotton output had shaved 0.5% off GDP growth.
The Express Tribune had reported quoting sources that the Pakistan Bureau of Statistics (PBS) had worked out a 4.2% economic growth rate for this fiscal year, but it did not please the finance minister.
On May 18, Chief Statistician Asif Bajwa had given a closed-door briefing to Dar about the provisional statistics, which within no time were revised upwards to the satisfaction of the finance minister.
Dar, however, insisted that the PBS was an autonomous body and he did not give any directives to change the figures. He offered to get the 4.7% growth figure vetted from an international expert and directed the PBS to hold a press conference to respond to the allegations of data manipulation.
However, Ashfaque Hasan Khan, who spoke at the seminar before Dar, said the PBS breached its charter by giving a presentation to the finance minister on May 18.
“The 4.7% growth was a forced rate of growth, as data suggested that economic growth was not more than 3.5%,” said Khan.
He said 4.7% growth could not be achieved at a time when the government was implementing austerity policies and the agriculture sector was shrinking.
Khan said due to the manipulation of fiscal deficit data, tax revenues and economic growth, there was disconnect between the economic theory and the results of research based on fudged data.
Ad hominem
Dar claimed that Khan was criticising his policies after he was not appointed as director on the board of Pakistan International Airlines (PIA).
However, Khan denied having ever requested the government to appoint him as director. “I got a call from former aviation adviser Shaujaat Azeem who informed me that I have been nominated as director on the PIA board,” said Khan, explaining when the notification was issued his name was not on the list.
Economic Advisory Council: Govt is aiming for 5% GDP growth, says Dar
Other perspectives
National Assembly member of PTI, Asad Umar, criticised the government for not bringing any meaningful tax reforms during the last three years. He said tax revenues were increasing due to heavy reliance on indirect taxes and quasi-indirect taxes.
He told the finance minister to present a pro-growth budget, as his last three anti-growth budgets increased unemployment and hurt foreign investment.
Umar also criticised the debt management strategy, saying the finance minister shifted to expensive long-term borrowings through the Pakistan Investment Bonds (PIBs) when interest rates were declining. This wrong strategy put a huge extra burden on the exchequer, he said.
The PTI leader said the country had been stuck in a debt trap and the situation would be more worrisome in the next three years when expensive Eurobond borrowings would mature.
PPP Senator Osman Saifullah criticised the government’s development model. He said resources of underdeveloped areas were spent on big metropolitan cities, which was further increasing the divide between the rich and poor.
Published in The Express Tribune, May 22nd, 2016.
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