Fix the house for Naya Pakistan

The entire nation is glued to the national political drama once again. Political leaders are once again toying with – or claiming to represent – the lives of the common man. Every six months or so, there is another Pandora’s Box for people to worry about. Be it no-trust motion, Senate elections, IMF or no IMF, mini-budgets, National Accountability Bureau (NAB) cases or the “absolutely not”.

Politicians have kept the 3.5 years test match topsy-turvy. These have real costs. For people in the assemblies or bureaucratic offices, these may be more content for TV talk shows, social media and newspaper discussions. However, for the common man, it just piles up the misery upon the misery. Naturally, the role of the strong opposition, media and judiciary is to nudge, evaluate and guide policymakers’ attention to the problems of people.

Nonetheless, the uncertainty is delaying the prosperity or the hope thereof. Before spending any dime, investors (try to) plot the future. While trying to navigate the clouds of economic variables, they take a leap of faith. That very leap of faith is what drives economic gains across the country. Those risk-takers require assumptions on the macro-economic outlook. Given Pakistan’s fragile economic framework, rupee depreciation, taxation culture, changing policies, interest rate and perpetual shuffle in bureaucrats making policies compound the delayed decision-making.

Eventually, money remains in the unproductive real estate sector, in the bank or under the carpet, if it can’t be leaked abroad. While an independent foreign policy is something to sell to the masses, the diplomatic change of course can also be timed in a subtle manner, instead of being publicly aired.

Statements such as “absolutely not” or rebuff to the European ambassadors’ letter on Ukraine despite having merits should be carefully delivered. Unless it’s a deliberate ploy to change public opinion or publicly air shifts in foreign policy, these moments create worries among investors.

It is imperative to fix our house first and foremost before chartering a bold geopolitical gesture. The game of strategic dominance requires economic independence. Chinese economy grew at an enviable 8-10% for decades before seeing eye to eye and trying to create a new world order. The focus was inwards for years. Pakistan must learn from this miracle of the Chinese as well. That requires tough, bold and urgent decisions. You have got to put bandage on economic leakages first.

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The piling losses of Pakistan International Airlines (PIA), Pakistan Steel Mills, Pakistan Railways and energy distribution companies are a matter of national security. Every day’s delay is costing billions of rupees, which could be diverted to development, debt repayment and social security. In the private sector, these have far better chances of efficiency than under any political arrangement. Similarly, policymakers should work round the clock by engaging the stakeholders to develop new policies for the future. There has to be a realisation – and panic – that with the current setup, we would never become a middle-income country.

That requires training the young population for exportable skills, enhancing food security to feed citizens, embedding value addition in every sphere and diverting resources to economic wellbeing. On a side note, politicians TV time should be restrained. Conclusively, the point to ponder for readers is what would improve the lives of people at the bottom of the pyramid? From 2017-18, the Pakistani rupee has depreciated 70% and taxes have increased amid the decades-high global inflation.

Certain things are beyond our control. But what should be in our hands, should be gripped tightly. If efficient decision-making requires private sector equivalent bonus to the bureaucrats, so be it. There should be a carrot with the stick of NAB as well. If politicians would be at the edge with the four-year tenure, so be it. Leaders should come to terms with the realisation that a majority in Pakistan only watch TV talk shows to entertain themselves.

The purchasing power has been on the decline for years.
Pakistan needs to triple up the efforts to avoid falling into another frying pan of low growth and debt trap. Naya or Purana Pakistan, it’s time to fix the house.

THE WRITER IS AN INVESTMENT SPECIALIST WITH KEEN INTEREST IN POLITICAL ECONOMY