It seems to be all over for foreign investors in the country. The current attitude of political parties is responsible for killing the glimmer of hope that investors saw in Pakistan after the May 2013 elections. While one can argue that the main opposition parties are not doing anything to keep the ruling party on the right track when it comes to instituting economic reforms, the sheer inability of the Nawaz Sharif government has also resulted in the failure of transforming the early feel-good factor among investors into concrete economic progress.
When you lack competence, you cannot blame others for creating problems for you. The PML-N government cannot blame the opposition parties for not allowing it to implement its economic agenda. A large number of business leaders believe that the graph of the government’s performance has declined significantly over its time in office. The PML-N is either moving very slowly or completely ignoring major economic issues that it committed to take up in its manifesto before the elections. For instance, the private sector is now squarely blaming the government for extremely slow progress on all major coal-based power projects. Looking at the lethargic attitude in finalising policies, top executives in power companies say that the country may not get any power from any such project in the next couple of years.
Secondly, the government has completely failed in the timely appointment of competent heads of major regulators and state corporations. This indecisiveness has only nurtured uncertainty in these institutions. The last PPP-led coalition government was especially notorious for appointing incompetent or unqualified people at regulating bodies and state-owned companies. To avoid any criticism on such important appointments, the PML-N government has become the casualty of another evil: indecisiveness.
The PML-N may lose its image as a pro-business party as people do not want to listen to excuses when it comes to job creation, implementing a reform agenda and economic growth. On the other hand, it seems that opposition parties find it easy to criticise the IMF programme, foreign aid and expensive electricity, but have not really given any concrete alternatives. Supporting heavy subsidies on gas and electricity bills will not be a favour to Pakistan’s economy. Cash-starved countries like Pakistan can never sustain heavy subsidies on electricity and gas production.
Without heavy foreign investments in infrastructure, Pakistan cannot come out of its current problems like the power crisis, poverty and security challenges. However, foreign investors are being driven away from Pakistan because of continued political uncertainty. No foreign investor would like to come here in such conditions; how can we even talk about investments.
Published in The Express Tribune, October 29th, 2014.
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