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WEEKLY
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Opinion Archive
The News International Pakistan
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| Issues at hand |
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By Tasneem Noorani
The rise in the political temperature in the country after the NRO judgement and the confusing response of the president compounded by the inability of the PPP leadership to take any meaningful decisions on issues such as the abolition of the 17th Amendment has everyone on tenterhooks. In fact, this is distracting the government from attending to issues of terrorism and economic instability. . The fight against terrorism seems to have been left entirely to the army. The operation in Swat and South Waziristan is giving the government a false sense of fulfillment. There is no urgency at the political and civil front to tackle the problem. The mere announcement of the formation of the National Counter-terrorism Authority (NCA) is being considered as an achievement both by the president and prime minister.
The fact is that NCA is still looking for an office since the last eight months of its existence. The interior minister makes hard-hitting absolute claims of action he is taking when, in fact, his ministry is extremely over-rated. Unlike Iran and Turkey, the ministry of interior has no intelligence agency under it to monitor and control matters of security. It has no direct police under it except the Islamabad police. Even para military forces like the Frontier Corps (FC) and Rangers are more under the army than the ministry because the commanders of these forces are two-star generals hoping to advance their careers.
There is an urgent need to review the system if terrorism is to be dealt with on a long-term basis. The NCA is a good idea but it will not go anywhere if it is treated as an achievement and an instrument for propaganda. The PM needs to take the NCA directly under his patronage just the way Musharraf made devolution a priority and made the National Reconciliation Bureau (NRB) a part of the PM's office. Similarly, the ministry of interior needs to be completely revamped so that it can stop being used as a government mouthpiece. It can deliver results only when the government's writ is not battered the way it has been done now.
On the economic front, there is general adulation all around for the NFC Award. The Punjab government is being praised for having relented on its stand on population as a basis of resource allocation. The federal government, on the other hand, is being praised for cutting down its share in the pie: from 52 per cent to 44 per cent meaning a reduction of Rs217 billion in its resources. One wonders how the government is going to manage its affairs with this huge decrease given that its activities remain the same. There is no sign of the education, health or local government ministries being closed down. The ministry of finance's claim to bridge this gap by austerity measures and increasing revenue receipts is as old as the country itself. No austerity committee of the past has made any sustainable impact on government revenue. Even if half the ministers are sent home, it will at best save one billion rupees. What about the other Rs216 billion?
Then, there is the claim of raising more money from the Federal Board of Revenue (FBR). Press reports of the past few months indicate that the tax to GDP ratio has actually declined and is now somewhere between 8.5 to 9 per cent, one of the lowest in the region. So to expect the revenue receipts to suddenly jump when the reverse has happened is hoping for the impossible. Compounding the matter is the internal turmoil in the FBR in creating an inland revenue service by merging the customs and income tax service. The current legal battle between the service groups s hardly conducive to an increase in revenue.
Unless action is taken, there will be an acute lack of resource at the centre as the impact of the NFC starts to unfold, leading to decreased efficiency. Also, there will be a slashing of Public Sector Development Programmes (PSDP) and an untenable deficit caused by increased deficit financing, thus leading to further inflation. The provinces, with their current levels of capacity to utilise funds efficiently, will have surplus, thus leading to a temporary and fake euphoria of well being.
On the trade front, while other countries convert their raw produce to value added products for export, we are exporting our cotton and yarn with abandon, knowing fully well that we will have to import it soon. The farmer lobby is much stronger than the textile manufacturers lobby. So while the new textile policy envisages giving 90 per cent of Rs40 billion on the value added textile sector, the ministry is unable to stop the export of cotton and yarn. Resultantly, most of this money will go to sustain only the loss of the value added industry rather than enhancing exports. While the export of cotton went up by 107 per cent and the export of yarn by 44 per cent in July-November (2009), the export of knitwear declined by 7.5 per cent, bedware 7.2 per cent and towels 6.2 per cent in the same period.
Unless the government can gear itself to function simultaneously in all sectors , rather than get bogged down by political shenanigans, we are sure to lose on both the terrorism and economic fronts.
The writer is a former federal secretary. Email: tasneem.noorani@tnassociates.net
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ISSN 1563-9479 