Senate session: Govt comes under fire on ‘handing over’ economy to IMF

ISLAMABAD: The government came under scathing criticism from the opposition in the Senate on Friday over alleged hand-over of Pakistan’s economic policy to the International Monetary Fund and that talks were being held between IMF and IMF on a bail-out package for Pakistan.

Former chairman Senate Mian Raza Rabbani said that past civilian governments never got the opportunity to formulate the foreign as well as security policy, but now the economic policy of the country had also been snatched from the civilians and handed over to the International Monetary Fund (IMF).

Speaking on a motion about recent increase in rates of petroleum products, filed by PPP Senator Sherry Rehman, he said the ongoing talk for a bailout package was in fact between IMF to IMF and not between government of Pakistan to IMF.

He pointed out to substantiate his contention, “the appointment of Adviser to the Prime Minister on Economy and the State Bank of Pakistan (SBP), a sitting IMF employee shows, who is running our economy, have also heard that IMF is giving dictation to the government about the budget for the 2019-20”.

Rabbani continued that the past governments also made agreements with IMF, but in those agreements there was no condition of “sell out’, as they did not change their finance ministers on the orders of IMF. “But this government not only changed its finance minister but also replaced him with an IMF man and then handpicking another sitting employee as SBP governor, which is unprecedented,” he lamented.

“At present, there are two gaps in the economy of the country – the first one is that of the rupee, while other is of the dollar – the dollar gap is there because of excessive imports in comparison to the exports and the rupee gap is there due to government’s excessive spending,” he explained.

He claimed that IMF had also told the government to withdraw Rs700 billion tax exemption besides withdrawing Rs350 billion tax exemption in forthcoming budget; the government had also agreed with IMF to further increase gas and power tariffs in budget.

About appointment of Shabbar Zaidi as new chairman of Federal Board of Revenue (FBR), he said the cabinet secretary had already informed the government that his nomination was being hit on two counts – one, on a 2013 judgement of Islamabad High Court, and the other is on the question of conflict of interest – as Zaidi is a senior partner of AF Ferguson & Co and remained tax consultant of different business houses.

Rabbani asserted that to circumvent the IHC decision, the government took refuge under pro bono and said he [Zaidi] would work on honorary basis. A suit, he noted, was pending before Sindh High Court, which deals and pertains to liabilities of AF Ferguson & Co as a company and as an entity in payment of taxes. “Is this, now not going to be a conflict of interest,” he questioned.

Taking part in the debate, Senator Javed Abbasi of Pakistan Muslim League-Nawaz (PML-N) said the government had unleashed three petroleum bombs and the recent one was no less than a nuclear one due to which everything had gone skyrocketing. He regretted that prices of gas were increased 143 percent, and some 3.4 million people were slapped with inflated gas bills, but despite commitment that overbilled consumers would be compensated accordingly, no one was given a single penny.

Abbasi said that former finance minister Asad Umar was booted out on the dictation of IMF, while Adviser on Economy and the new SBP governor were handpicked on the reformation of the institution, which was quite shameful.

Senator Sherry Rehman, PPP parliamentary leader in the Senate, said the government was introducing tax amnesty schemes for the rich and inflationary packages for the poor. “Why have petrol prices gone up by 14 percent before May 1, the GST was 2 percent of the total petrol price, which was increased to a whopping 12 percent before Ramazan. This is the only Ramazan package the government has given. A horrifying third budget is on its way,” she noted.

She said that petrol was the backbone of any economy and rise in POL impacted every sector and every commodity; in Pakistan the biggest user of petrol was the transport sector that consumed 48% and the price of a 50kg bag of urea increased by Rs150. “All will be hit hard by this petrol price bomb. Transportation has become so expensive in Pakistan that food and public transport has come to a halt. In KP itself, the transport sector is warning of a wheel jam strike due to the increase in petrol prices,” she continued.

Maulana Abdul Ghafoor Haideri of Jamiat Ulema-e-Islam-Fazal (JUI-F) said that half of the cabinet comprises of turncoats as there is not a single person in the country who can have a solution to the problems faced by the country.

He lamented that the government that came into power on the promise of giving jobs, had left people jobless in every sphere of life and the claims of building houses were proved otherwise after houses were razed out in the name of anti-encroachment drive. Haideri called upon the opposition parties to play their due role in ousting the government as this was the voice of the people. The House will now resume on Monday morning.