- Over-zealous official institutions rock the fiscal boat
A combination of the country’s emaciated economy, which now exhibits the craziest macroeconomic statistics, its lethal prolonged financial uncertainty, unprofitable internal political squabbling, and regional instability and war-mongering, have frightened away not only foreign investors, but also compelled local industry to sit on the fence and watch developments from the sidelines. Economists may differ on the various steps and conditions needed to reverse this unhealthy economic stupor, but on one vital point they are all agreed, that there must be ease of doing business and commercial people must be given a patient, fair hearing by investigative agencies like FBR and NAB, or the courts, before taking any extreme action likely to cause financial setback or tarnish their name and image in the public eye. Unfortunately, some controversial activity, including FBR officials’ alleged surprise raids on various markets and ‘interrogation’ of traders at their places of business, and NAB’s apparent haste in instigating high-profile inquiries against captains of commerce, have sent the opposite message of fearfulness among the already nervous business community. The stalled engine of economic growth cannot be reinvigorated under the shadow of such ‘old-fashioned’ threats and obsolete pressure tactics.
The peripheral problems faced by Pakistan’s cellular industry, despite reaping fabulous rewards, present an apt example. Its clientele has grown by leaps and bounds in the last two decades and now comprises over 151 million subscribers. But, first the country’s war on terror had direct legal and pecuniary implications for the industry because of the previously unregulated system of mobile phone SIMS, and later the apex court too weighed in with its suspension of the not inconsiderable taxes deducted by cellular companies, including their service and maintenance charges. Lately, NAB too has issued a call-up to senior management of an old-established cellular company, operating in Pakistan since 2001, in connection with an inquiry against officials of the regulatory Pakistan Telecommunication Authority for alleged illegal award of 4G/Long Term Evolution to the said company. The latter has challenged NAB’s call-up notice in the Islamabad High Court citing mala fide intentions and harassment, but whatever the outcome, there will be much unwelcome mud-slinging and adverse publicity. With such a rigid official mindset, the fiscal future offers the dreariest of prospects.