Dollars and sense

PPP spreaded the feeling that “ruthless industrialist from Lahore” would stop support to marginalised segments.

Since 1985, I have been attentively listening to all the successive finance ministers delivering their budget speeches while sitting in national assembly’s press gallery. Being an economic-illiterate, I am yet to figure out why so much media hype is created about this day.

My cynical ignorance does not deny the reality that the chattering classes of Islamabad were waiting for the first budget of the third Nawaz government with too many hopes and expectations. Although a peculiar crowd of ‘economists,’ ever willing to deliver for non-elected governments, continued to behave dismissively. For them, Ishaq Dar is nothing but a “munshi (private accountant) of the Sharif family” and people must not expect headline making initiatives and tough but unpopular decisions to reform Pakistan’s economy, both on macro and micro levels, from him.

Dar, for sure, was neither bombastic nor rhetorical while unfolding various tasks set for the immediate, medium and long term turnaround by the PML-N government. He studiously maintained the posture of a task-driven manager presenting his work plan before a yawning and half-asleep crowd of public representatives. While placed in the government by a respectable-looking mandate too close to the presentation of the budget, Dar and his boss hardly had any time to focus on its preparation. Yet, they instinctively fathomed the need for improving and enhancing the revenue collection capacities of a near-bankrupt state. For the moment, though, their priority is to kick-start the flat economic activity in Pakistan. The unbearably long hours without electricity are rightly considered the main hurdle in this context.

Without clearly saying so, the finance minister wants to address it by paying off the circular debt in one go by printing more money. After passing this hurdle, the government intends to rationalise electricity prices. People will certainly find the intended increase very hard to swallow, but it can no longer be avoided. After moving on much awaited structural reform in the power sector, the government is all set to approach the IMF, somewhere in October-November this year.

The PPP candidates had used all ploys to spread the feeling that after coming into power, the government of a “ruthless industrialist from Lahore,” would immediately stop doling out financial support to the marginalised segments of society. Dar appeared to have baffled them by proudly announcing that instead of terminating the social support program, he would increase the dole amount and bring more people under its protective net. It certainly was a smart political move despite sounding like a populist gimmick.

Often, when Dar was rushing through his speech my mind would drift to wonder about Dr Hafeez Sheikh. For three years from 2010 to early this year, he had been calling the shots as a self-absorbed ‘professional’ with a Doctorate from Boston University. I vividly remember the noon of May 27, 2010, when I had a one-on-one meeting with President Zardari in his office. During the course of our conversation, I bluntly asked him to explain how he had discovered the said wizard. “Darling,” he candidly replied, “they (read the local and foreign establishment) made it either/or for us when it came to finding a new finance minister after the resignation of Shaukat Tareen. Hafeez Pasha and Hafeez Sheikh were the people they named and I preferred the Sheikh, also because Khurshid Shah informed me that his father had been a founder member of the PPP from Jacobabad.”

It is a different matter that since late 2011, the same Zardari would badmouth and criticise the doings of “this babu sitting in the finance ministry” to those he felt comfortable with. In this column, I also started dropping hints regarding Zardari’s disappointment with Dr Sheikh after listening to multiple sources. He, however, preferred to presume that the President was personally leaking the negative stuff about him to me and began throwing tantrums in official meetings.

He could still survive by convincing the PPP government that, through his inimitable skills of negotiating with Americans, he would get a massive amount of US dollars by restoring the punitively delayed Coalition Support Fund. Before going to the polls, the PPP government could spend the major chunk of this amount to settle circular debt. People would no more endure long hours of load shedding and thus “reward” the party by voting for its candidates in the election. By selling the said story, he single-handedly managed the restoration of supplies to NATO forces based in Afghanistan via Pakistani routes after their blockade for seven months. The PPP government did not get what it expected in return and the rest as they say is history.

Published in The Express Tribune, June 13^th, 2013.