Naya Pakistan at two

The government appears buoyed by a few recent successes, even though its overall performance is well below par

The Naya Pakistan of Imran Khan turns two today. It was on August 18, 2018 when the cricket legend and philanthropist had taken oath as the 22^nd Prime Minister of Pakistan. As we take a look at the two-year performance of Khan at the helm, his government appears buoyed by a few recent successes, even though its overall performance is well below par. The recent reasons for the Khan government to cheer about are as follows:

1) Covid-19 containment under a successful smart lockdown strategy; 2) bringing an unfriendly opposition round to agreement on FATF-related legislation from parliament; 3) improvement in key economic indicators, like 6% increase in exports year on year, 23% rise in tax collection in the first month of the ongoing fiscal year as against the same period previous fiscal, and 6-10% surge in use of petrol and diesel indicating a spike in commercial activity in the country of late; 4) uptick in construction activity that is evident from a 22% increase in the consumption of cement and indicative of the success of the PM’s construction package announced three months back; 5) the Supreme Court decision on Gas Infrastructure Development Cess that would inflate the national kitty by Rs417 billion; and 6) agreement with Independent Power Producers under which payments would only be made for the electricity acquired and consumed instead of the total installed capacity of a particular power plant — something that would pave the way for provision of cheap electricity to consumer on a sustainable basis.

Simultaneously, the Khan government is caught up in one of the toughest and most serious diplomatic challenges Pakistan has come across. The government finds itself in a tricky situation where it has to preserve its historic relations with Saudi Arabia alongside ensuring that its Kashmir diplomacy is able to maintain its recent momentum and its principled stand on the Israel-Palestine conflict is not compromised. Well, foreign policy is not the only challenge. Economy, governance, service delivery, and political stability are among the major issues too.

While some areas of the economy have started showing signs of improvement of late — as mentioned above — the government terribly struggled in this key area right through its tenure so far. Key indicators currently depict a grim economic outlook. The GDP growth rate, as assessed by former finance minister Dr Hafiz Pasha, will be standing at positive 0.5% for the current fiscal year. Average inflation, measured by the Consumer Price Index, shot up to 9.3% for the month of July, raising fears of a raise in the key interest rate which has been brought down to 7% from 12.5% (in March 2020) as part of Covid stimulus packages announced for businesses. Prices of wheat flour, sugar, vegetables, milk, petroleum products and utilities all have undergone big increases in comparison with those in the previous tenure. At Rs168 to a dollar, our currency has weakened by 35% against the greenback. The total public debt has also ballooned by Rs10 trillion reaching Rs35.2 trillion in two years. Current account balance is the only bit of the economy that offers something to write home about, having gone down to just $2.97 billion from a mammoth $20 billion. Besides, the government’s accountability drive also contributed to the economic downfall by giving rise to political uncertainty.

Governance remained a disaster and the government’s pledges of reforming bureaucracy, depoliticising police, and tackling corruption only complicated with time. However, despite severe cash crunch, the government did try to strengthen social security net, doling out reasonable sums under Ehsaas Programme and increasing EOBI pensions. One area where the government deserves full marks is its green initiatives. All in all, the second year turned out to be better than the first.

Published in The Express Tribune, August 18^th, 2020.

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