A citizen’s economic manifesto
Pakistan’s economy is in dire straits, with an overburdened, bleeding population. It needs urgent surgical repair. In this election season, the various political parties of the country have published their manifestos. Here, I am presenting a citizen’s economic manifesto that can be adopted by the party or coalition of parties forming the next government. It borrows heavily from the past. After all, why not use what worked!
Following is what must be done by those at the helm:
There must be a massive, urgent crackdown on hyperinflation through a minimum 50% reduction in non-development expenditure. The number of federal ministries must be reduced to six, and the cabinet must be no larger than twelve ministers. There must be no special assistants, advisers, or ministers of state. Provinces must follow suit.
High salaries, such as Rs8 lakhs per month or more, being given to government appointees, judges, bureaucrats and members of the armed forces must be reduced by 50%. Free prerequisites given to all cadres earning Rs4 lakhs per month or more must be abolished. There must be no free utilities and official overseas travel. Protocol given to ministers and other government officials at public expense must be abolished.
Agreements with Independent Power Producer (IPP) based on capacity payments must be rectified. The cost of electricity must be reduced, and duty-free and tax-free import of solar panels must be allowed.
An import policy like the one that successfully operated in the 1950s, 60s and early 70s must be reintroduced. It may be recalled that the Chief Controller of Imports and Exports would announce a needs-based import policy, where trade liberalisation was driven by the needs of the economy. For example, the import of iron and steel for construction, raw materials for industry and food grains for local consumption was facilitated. Luxuries must be banned.
The bonus voucher system for exports must be reintroduced to control the balance of payments. Exporters can sell their bonus vouchers in the stock market and finance the import of non-essentials such as cars. A system must be introduced through which agri-based large industry is directed to ‘adopt tube-wells’ to lessen the electricity burden on farmers. Sovereign guarantees must be used to encourage the Pakistani diaspora to invest in Pakistan.
The Federal Board of Revenue (FBR) must be extensively reformed to expand the tax base, and all information available with the government must be used to ensure that the affluent class that is not paying taxes become taxpayers. No foreign travels must be allowed to affluent persons who do not pay tax. Indirect taxes and duties on food items must be terminated.
If these measures are urgently taken after the upcoming general elections, they will help stall the freefall of the Pakistan economy. They will rebuild business confidence. Ultimately, it is strong, locally powered and innovative business activity that will rescue our economy. We have the means and resilience to recover, but we must recognise our economic crisis and take emergency measures without wasting any more time.
Published in The Express Tribune, February 8th, 2024.
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