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It was a policy announcement so nice, they decided to make it twice.
After being criticised by many in the national media for their economic policy agenda when they first announced it in Islamabad, the Pakistan Tehreek-e-Insaaf decided to take a second crack at introducing the public to their proposals, changing the venue to the country’s commercial capital and inviting more economic analysts and business reporters to cover the event.
Former Engro Corporation CEO Asad Umar and former federal industries minister Jahangir Khan Tareen, the party’s two leading policy wonks, made a joint appearance at a local hotel in Karachi, and laid out in unabashedly technical details many of the key aspects of the PTI’s economic policy agenda.
Given the fact that both men have led KSE 100 companies, it is somewhat unsurprising that they were both at the event on time, though it still started late because most of the reporters sent to cover the event took their time getting there.
Nor was any time wasted on political speeches glorifying party leaders. Tareen made some short introductory remarks and then turned it over to Umar, who then delved right into the five-point policy agenda, which comprises tackling the energy crisis, cutting back government expenses, tax reform (which includes cracking down on tax evasion), reforming the civil service, and increasing services such as health and education to citizens.
Policy buffs looking for details on the PTI’s proposals would have been disappointed by the event: there appeared to be no more details on offer than those laid out in Islamabad, though both men allowed for more questions, which helped clarify many of the party’s positions.
For instance, it has become increasingly evident that the PTI leans towards the left when it comes to its economic policy agenda. The party advocates not only for a robust regulatory role for the government – on which both the ideological left and the right agree – but also more direct involvement of the state through professionally managed state-owned enterprises. The PTI does not rule out privatisation, but its leaders did not seem enthusiastic about the process either, prefer instead to model itself on the state-centric vision of capitalism now being championed by Chinese leaders as an alternative to Anglo-American liberal capitalism.
The weakest link in the PTI’s policy proposals appears to be tax reform. The party broadly lays out a strategy to increase revenue and addresses some critical elements utilised by corrupt bureaucrats and businessmen, including the statutory regulatory order (SRO) system, which allows Federal Board of Revenue officials to offer tax exemptions to favoured businessmen.
However, neither Tareen nor Umar addressed the “presumptive taxation regime”, which institutionalises incentives for businesses to remain undocumented by removing income tax liabilities in exchange for payments of federal withholding taxes.
Nonetheless, the PTI leaders appeared to suggest that if the FBR was made an autonomous federal body, much like the State Bank of Pakistan, it would begin functioning more efficiently in raising revenues. The party hopes to use this, and other reforms, to increase the country’s tax-to-GDP ratio to 15%.
Tareen and Umar both used far more measured language than party chief Imran Khan when talking about the International Monetary Fund (IMF). Khan has famously referred to the Washington-based lender’s bailout programmes for Pakistan as “slavery to the IMF”. The men who would most likely deal with the IMF in a PTI-led government, however, seem to be keen not to burn those boats, just in case the economy needs them.
But more than an economic policy announcement, the PTI seems keen to present itself not just as the populist rabble-rousers who can get the masses riled up about hot-button topics, but also as a mature political party capable of governing the day it is sworn into office.
(Read: PTI’s economic policy)
Published in The Express Tribune, August 30th, 2012.
COMMENTS (73)
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Imram Khan is very honest and better thant the present persons holding power. But he is still not seasoned enough to deal with the crisis and lacks vision in solving political and socio-economical problems.His thought for creation of more provinces is not matured and based upon international solutions of creating more provinces.Imran Khan thinks that creating more province will help and elevate the image of MQM. He is not thinking that more provinces are good for every Pakistani not only MQM. In 1973 East Pakistan had only one province. Now after creation of Bangladesh there are 19 provinces. In india too the creation of more provinces has helped India solved its internal problems and now India is a big emerging economic power and standing on strong footing. We must think beyond our nose and create more provinces in Baluchistan,Punjab,KP and Sindh.If we want to save Pakistan from further break up the only solution is create more provinces.It is the demand of educated and common persons. East Pakistan would not have beome Banglades if there would have more provinces in East Pakistan.Imran Khan must change his thinking and support for more provinces in Pakistan.
@Ch. Allah Daad: "One more useless economic lecture."
One more USELESS comment by Ch. Allah Daad.
If PTI is willing to announce they will eliminate all jihadis , lashkars,talibans,jamaat all dafan groups. the whole of Pakistan will vote for them
how it can change it is this ture this the reality of new pakistan people wants change in pakistan
Dear Mr Farooq Tirmizi, I would have preferred to have seen this article in your blog - while your points are (in my opinion) solid, it (the article) exudes personal interpretation.
I think that if PTI just implement 50% of what they say it can change the the destiny of our country Allah bless PTI and Asad Umer for this great work. May Allah bless my beloved home country.
@Adnan LOL, Were you being sarcastic in that comment of yours? I mean "Taxis"... and "Sasti roti"... is this something you want to mention in a country's economic policy!?? BTW Sasti Roti scheme was inspired by Imran Khan's "Sasta Tandur" (yeah IK opened a few sasta tandoors for the poor in the past) bt IK did not suffer any losses nor did his tandoors go into "corruption" unlike Shahbaz Sharif's "Sasti Roti" scheme.
@Asad-- PTI has made no alliance with Sheikh Rasheed.
Running company and country is different - no doubt about it. Different skill set with one difference. The country finance czars are mostly dispensible whereas a company leader are not. Put it this way - if u.s. finance head was paul rubin or Geithner or some educated XYZ would have mattered little in what U.S. is today. However, if the CEO of Apple was any educated XYZ vs. Steve Jobs the tech world, and the world's way of accessing information and using productivity software/hardware would have been radically different today.
It's not the fact that Asad umer ran engro but the fact that he is smart enough to make engro successful in some of the most difficult times for Pakistani businesses with the most incompetent government at the helm.
@Vikas: From the last 30 years, we have seen the people who claim to be expert in running country. and now see the results.......let give a chance to new players
@Vikas: Dont you think the pain will be be much lesser than the pain these three stooges have give us. They may not be able to bring the best but surely better than these looters have given us . We are ready to test him and perhaps we dont have high hopes.
They need a reality check !
@Vikas: and who here really 'knows' or got training on how to run this country? Look at where we've reached today thanks to all the experienced lot.
PTI has a bright future as a party as well as for Pakistan...............Keep it up!! People are with you IK ,they want a change .The incumbent government will not contest,but buy elections & for that they have accumulated enough money????
Great start PTI...atleast someone is taking the right steps at the right time....
Javed Hashmi and Asad umar are kings in their respective fieid both of them are in pti
IK was true to his word when he said he will bring in the best minds... Asad umar is an example
Guys atleast give PTI creditfor formulating these policy reforms way before coming into power unlike other parties. Now as far as implementation, execution & successful completion is concerned that's will be national goal with them to achieve. Reason twofold; 1) PTI/IK the only untested option for Pakistan, 2) these are after all businessmen therefore can run the business of state & politics atleast in a refined way. Hope this makes sense. Rdgs.
I think it was a very sound and comprehensive presentation.According to my sources there is much more to reveal from PTI's side.PTI's economic team have too many intellectuals from renowned universities who can cahnge the direction of our country.PTI have not revealed those names yet.And this team is headed by Mr. Asad the Economy King.
But more than an economic policy announcement, the PTI seems keen to present itself not just as the populist rabble-rousers who can get the masses riled up about hot-button topics, but also as a mature political party capable of governing the day it is sworn into office.
ET just made my day...
@ Vikas
Idiotic cracks coming out of an Indian, yet again!!
Here is the quick look at your 'whining India' - Whose 80% population lives in poverty, hunger, malnutrition - 90% have no access to clean water & health - 40% population does not have electricity - 12 million baby girls killed annually in mass female infanticide, - More hungry and more poor than sub saharen africa - 800 Million defecating in the open in the world's largest open air latrine - 45% of India under Maoist control - More than 100 insurgency across India
Get your country out of the gutter first before advising us.
Good luck PTI..We are with you
I don,t know when we become thankful to Allah Tallah and start appreciating those who at least takes a bold stand against all feudal lords, dictators and corrupt politicians who convert the real meaning of democracy into kingdom where one dictator or king died by adding his or her son name in the list, beside criticizing the economical policy, please look at the bright side, It creates history in Pakistan Politics, that a party who is even not in the government presenting structured economical reforms for economical stability and growth.
Asad Umar is a prime example why politics should be left to politicians. The PTI team has one fundamental problem: they think everyone is going to embrace these reforms with open arms. No sir, the media is going to start a campaign, bureaucracy and traders are going to go on strike and judiciary is going to issue stay orders on every thing.
Good literature!!
PTI has done a wounder full job. Now its time to push other parties to public its detailed economic policy that shall be compared and set what is more practical.
@Asad Shah:
Asad i am agree with you lets vote for PPP and PMLN they are the most honest five times tried and tested people.
@Vikas:
so should we let people lead again who led us for 5 times each? may be this time they can do it better? why can't people of Pakistan realise this that vote once in their life for country not for bradary, or party or person?
or is this fashion statement these days?
Alleast someone is serious to uplift the economic situation of the country. Good Luck PTI.
Running a company ? are you kidding me ? Asad Umar is an Economist who has been over large scale transformation on government level under different bodies. Presentations are never detail oriented. They present the key points only! Peope looking for further details wait and see it on the Website.
A good practical start of PTI. Great work done by Economic Team. We wish you and Pakistan Best of luck!
Asad Umar's name is on the top of the list in a recently published book by Feroz Sons. Name of the book is "Hundred Top Businessmen of Pakistan". And still PMLN people campaigning that the team is incapable. Joke of the century.
So, then the investment treaty that are under discussion between PAK and US will be useless in this state centric model of PTI?
@Ch. Allah Daad: and one more useless comment
The dawn of a new ERROR!!
@Awans: Its not as simple as it sounds. Levels of state intervention in economies vary across different developing countries because making high risk capital intensive investments with long strategic horizons is outside the resource base of private sector operating in a country. Comparing our state with that of economies that have 30 to 40 times higher GDP per capita is not necessarily the right thing. Furthermore, it is a misperception that anglo-saxon economic models are completely capitalistic. Many high profile projects such as modern internet are a spin-off from earlier state funded projects. It is just that state support in US and Europe works through multiple sophisticated layers in the form of private equity investments and extensive partnership in R&D. For reference, you can look up long history of protectionism for US based technology and automobile industries.
@Asad Shah: why are you so done and what lies are you talking about? wait and watch as you have done with other government leading political parties at least it’s not talking about roti kapra and makan?
@Vikas: At least he has reputation of an honest person along with a proven track record. everyone knows he is an able professional.
@Ch. Allah Daad:
Chaudhary sahab. I must have slept through it. I thought I was reading a report about a press conference. Did I miss a lecture some where.
@sabi: GST is what is usually suggested by IMF for administrative ease but it does not work for every country specially if the underlying assumption about cash movement within economy does not hold. We already have indirect taxation making up about 70% of tax revenue as per my understanding. On top of it, it is not only regressive but also inflationary affecting lower income classes. End of the day, it is not a matter of GST as such, but widening of tax net. As of now, we have significant portion of the economy that is off hands for taxation because of political meddling with original IMF proposal. That's why PTI is proposing widening of tax net instead of implementing new taxes or raising existing tax rates.
Whatever you do if defence budget is not cut in half nothing will imrove in Pakistan & PTI is made by makers to ensure that this does not happen.......Note: Asad Umer is son of Gen Umar.
I guess...I was first commenting on it....Anyways...I can notice..censor in free media...
No worries....we live with biases...
keep up...
@Adnan
Look at the Three E's of PML(N) ......You will not be able to control your laughter............Please wake up........
@Vikas....can you kindly name the institutions/processes through which current leadership LEARNED the method of running the country!!!!!!!!!!!!!........................ Apparently it seems their total skill is to take turns UNTIL there is nothing left......
@Ch. Allah Daad: After red lining his brain this is the best Chaudry sahib could come up with. (whats that smell)
can we vote already???
@Ch. Allah Daad: you mis-read, this was not PML-Ns presentation.
imran khan may have flaws but he is magnificent
Go PTI!
Now other parties should come and present their agenda. In Pakistan politics should be issue based. Nawaz sharif should come live along with Ishaq Dar and present his version of economy.
One more useless economic lecture.
They are wasting their time with Pakistani people they need to present corruption, kickback, deception policy to get some attention.
asad umar is a great asset of pti & pakistan.
ET specializes in subjective writing when it comes to PTI. This report is no exception. Perhaps, PTI should also include mass communication education/training in its education program. Not just that but indeed enhancing language skills be it Urdu, English, or any other language.
Sensible review. Should point out that policy is leagues ahead of any other mainstream party. Good job
Just talk and when it comes to action they form alliances with people like Sheikh Rashid. I'm so done with pti and their lies. Give us a break.
Hehehehehe
This is nothing wait till you see my leader Mian nawaz sharif anounce his economic agenda. We have delivered before and we will deliver again if given a chance, sasta tandoors, taxis and tax evasion are glowing examples of our deliverance.
Adnan Siddiqi Karachi, Pakistan
As Pakistan becomes more urban and middle class, the people need to move away from identity politics based entirely on loyalty with personalities and clans.
I am glad to see PTI setting a new standard for election campaigns based on issues and policies. I hope other parties respond with their policy proposals and seek peoples' mandate for their visions.
http://www.riazhaq.com/2011/07/political-patronage-trumps-public.html
Now its time for fellow Pakistanis to give them a chance and pray to Allah Almighty for their success :)
Yes PTI is ready.......The challenge is huge and we definitely need to be prepared in advance......I hope someone ever asks PPP,Q and PML N about their policies.
The easiest and most functioning tax collection sytem in developed economies is GST.In a corruption ridden society as Pakistan need for GST implementation becomes a necessity.But GST has been made controvercial just to attract more votes.PTI has also avoided this issue in it's economic reforms agenda.20% GST can make a big difference thoug a little sacrifice but good for economy in the long run.No money-no honey.
I have watched their presentation on Economic Policy and the follow up talk shows and to me, the policy overall appears to be quite comprehensive and more importantly practical. In my opinion, Asad Umar has done a fantastic work and deserve a well deserved appreciation.
Nice and Fair analysis. From a PTI aficionado
Solid work by PTI, it is heading in the right direction. However, full marks can only be given once the reforms are successfully implemented.
Good analysis. Thanks for covering it. As for your view on presumptive taxation, I think the issue is not as bad to contain as it sounds. The issue can be resolved through following measures: Firstly, it requires top-tier management change in FBR since it is one of most corrupt departments. This also requires promoting people with strong credentials (such as Faisal Chaudhry from Inland Revenue, a very brilliant and knowledgeable young guy). Secondly, invest in deeper and integrated analytics so that cross-comparison of information on assets and revenues can be done (this data already sits in different departments but is fragmented). Lastly, larger sample for audits, performance linked compensation of line employees, and rigorous receivable monitoring against realistic revenue projections should do the job.
The entire policy presentation can be seen here** http://www.scribd.com/PTIOfficial
My vote for PTI!!
Running a company and running a country are two different thing. If PTI comes to power, they and the people of Pakistan will realize soon. When the dream will shatter, then it will pain more. More pain in store for Pakistanis.