The worst is yet to come
The long hot summer of discontent is here. No matter what political views one holds, or whichever way one looks at it, there seems to be little light at the end of the tunnel.
As apprehended, the coronavirus pandemic is now hitting the country with full force. And the worst is yet to come.
Last Friday Pakistan broke its previous record of the highest single-day rise ever. With 130,000 plus cases and daily deaths from the virus exceeding 100 we have already surpassed China, the country now ranks 17th in Coronavirus cases globally.
Not that the advent of Covid-19 in Pakistan is the government’s fault. The pandemic like the rest of the world had to hit Pakistan.
The real challenge for the government in the upcoming financial year is how to jump-start the economy. It has given enough incentives to business and industry. What remains to be seen is whether they will bite or not.
But the haphazard manner in which it has been tackled leaves much to be desired. Prime Minister Imran Khan, rightly upset with the public for not following the preventive SOPs, has warned that he will personally monitor the situation and will be tough on the people.
Better late than never, but it’s like shutting the stable door after the horse has bolted.
The government’s Coronavirus strategy at best can be termed as patchy, bordering on sheer incompetence. When initially a national lockdown was theoretically in place, it never was properly implemented. Khan always made it amply clear that he did not believe in shutdowns as they will deprive the teeming poor of their livelihood.
Coupled with this, the Sindh government was consistently castigated by various federal and Punjab government spokesmen for insisting upon a lockdown. Hence, we had a lockdown that never was.
True, that the majority of the populace is culturally and also, owing to sheer economic needs, not akin to staying home and follow proper safety measures. But did the government really have its heart in enforcing a lockdown? Of course not.
Resultantly, we have had the worst of both worlds. People are dying at a much higher rate and at the same time (as is evident from latest figures) the economy is not reviving in a hurry. According to conservative estimates, the Coronavirus affectees number will exceed 200,000 by the end of this month as warned by the WHO (World Health Organisation) much earlier.
And according to the Prime Minister himself, the peak is yet to come in July and August. In the meanwhile, Khan comfortably ensconced in his ivory tower surrounded by his Covid-19 team frequently addresses the nation, pontificating what a beautiful job his SAPM (special assistant to the prime minister) on health Zafar Mirza and his team is doing.
In reality they are a couple of yes-men saving their jobs and refusing to state the bitter truth. Or maybe they do not know any better?
The situation on the ground is dire. There is an acute shortage (or perhaps self-created by profiteers) of life saving medicines. And even if available they are at an exorbitant costs running into several lakhs. It is utter confusion worst confounded.
If a citizen contracts the deadly disease, he has no idea where to go for treatment or who to go to. Most hospitals- including private hospitals with the limited beds they have allotted for Covid-19 patients- are bursting at their seams.
The government is parroting its oft repeated mantra: ‘sab acha hai’ (all is well) and that everything is under control.
Take the case of Budget 2020-21 presented with much fanfare. Read in conjunction with the Economic Survey it highlights the current state of the economy.
Of course, it is very dismal. But the wily advisor on finance, Dr Hafeez Sheikh, has blamed it all on the previous government and the pandemic. The fact that the first nine months of the financial year, (July 2019 to March 2020) the pandemic had not yet hit the country, is conveniently papered over.
Despite a number of exemptions and incentives there has been a sharp decline in economic activity like never before in the country’s history. Most economic indicators headed south during the financial year 2019-20. The GDP growth was negative at 0.38 per cent. But of course, the economic team did no wrong.
The fact that the IMF’s (International Monetary Fund) EFF (Extended Fund Facility) was negotiated by the present team is simply overlooked.
True, the economy was in dire straits when the present government took over in August 2019. But simply passing over the buck to the previous government simply does not fly.
Why did the former IMF/World Bank economic team negotiate a deal programmed to slow down the economy and inhibit growth? High interest rates, aggressive depreciation of the rupee against the dollar and record inflation was a lethal combination to bring the economy further down.
Dr Sheikh takes a lot of pride in not borrowing from the State Bank but does not fully explain why Pakistan had to take bilateral loans amounting to a humongous $12 billion during the tenure of the present government? This figure does not include the IMF facility or other loans taken from various international donors.
Of course, the official explanation proffered is that had the government not borrowed the economy- left in tatters by its predecessor government- would have tanked.
Industries minister Hammad Azhar presented a Rs 7.13 trillion annual budget on Friday. While no new taxes were imposed, he crowed about real or perceived achievements of the government during the outgoing fiscal year.
He underscored 73per cent decline in current account deficit but conveniently ignored the fact that this was mainly owing to a sharp decline in imports rather than a perceptible increase in exports.
Partly owing to an investment averse IMF programme followed by the pandemic, the large scale, small and medium size manufacturing sectors registered a negative growth and agriculture remained stagnant as well.
The real challenge for the government in the upcoming financial year is how to jump-start the economy. It has given enough incentives to business and industry. What remains to be seen is whether they will bite or not.
The growth target has been set at 2.1 per cent for the new financial year. But in the present backdrop it is expected to be in the negative. Similarly, setting a Rs 4.9 trillion tax revenue target might keep the IMF at bay for the time being, but is too ambitious.
Another royal mess is the plight of the sugar industry. It had to take its case for relief to the Islamabad High court. The Chief justice of the IHC, Athar Minallah, only granted an interim stay for restraining the sugar commission to institute criminal proceedings against them on the undertaking from the sugar barons that they would sell sugar at Rs 70 per kilogram.
As the special assistant the PM Shahzad Akbar had put it, the sugar industry was fleecing the consumer by creating cartels. But in his now signature vindictive style he lost sight of his stated goal to bring the sugar retail price down.
Fuel shortages in the country are another feather in the government’s cap. As per his norm now, the PM expressed his anger at the oil companies for creating artificial shortages.
If he looks closer at home a few members of his team primarily SAPM for oil and gas Nadeem Babar and related OGRA (Oil and Gas Regulatory Authority) officials should have been put on the mat. But accountability under the present power dispensation is solely for the opposition.
