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September 18, 2020

A growth unfelt

Business

September 18, 2020

LAHORE: As usual, the regime runners are trying to stir up false economic recovery euphoria, based only on narrowing trade deficit, while other key indicators like exports, inflation, manufacturing, employment, etc are telling a not so encouraging story.

The previous regime in its five years constantly increased the GDP growth and tax revenues that doubled in five years from Rs1,900 billion to Rs3,800 billion.

The present regime in its first two years could only nominally increase the revenues while the gross domestic product is constantly declining. And with it the standard of living is also on the decline.

When the economy is growing it is felt by all and sundry, you do not have to launch an advertising campaign. Every now and then we hear one federal minister or the other speaking about the turnaround in the economy. Even the Prime Minister comes out in their support.

The ground reality though depicts a gloomier picture. Life has become miserable not only for the poor but also the middle class families. There are few job openings. The country that was growing at 5.3 percent when this government assumed power is destined to grow at 2 percent this year according to Asian Development Bank.

This growth if achieved would be much better than -0.4 percent of last fiscal or 1.9 percent a year earlier. Our real growth in the first three years would be in negative as the growth of our population is higher than that of our economy. Yet the economic planners call it a turnaround.

Some economic planners argue that two years is too short a period to judge the performance of a five-year term of the government. And they are also likely to term three years of performance insufficient to judge a government. However most agree that performance of this regime has been dismal to date. Its actual performance would be judged at the end of the five-year term of this regime. It would be a miracle if the government is able to recover $51 billion GDP lost during past two years.

There are many sectors of economy that are not factored in the economy. The government may include these sectors to boost the GDP as was done by Shaukat Aziz during his tenure. These sectors regularly contributed to the economy but were not factored in. This increase in GDP would not go to the credit of the government as the economic activities were not improved but only documented. The real growth is felt when people feel good, secure, satisfied, etc.

It means increase in their purchasing power, improvement in their quality of life, better educational and health outcomes.

The difference between the present regime and its predecessor is the former has overlooked governance generally but is enthusiastic on selected accountability -ignoring the tainted persons that support it and hunting its opponents without hard convictable evidence.

The ignorance of governance has further dented whatever transparency was left in the system. The governance failure has impacted the lives of all citizens. The moneyed people are afraid of the National Accountability Bureau (NAB).

They avoid annoying the ruling party because ministers and spokesman of the regime point out beforehand that such and such person would be nabbed by the accountability watchdog. You do not have to do anything illegal to be caught by NAB; only annoying the high-ups of the ruling party is enough to get yourself in trouble.

Ordinary citizens especially the poor are facing multiple difficulties. They can be picked up by the law enforcers even on personal grudges or for having done nothing wrong. They can be thrown out of work without assigning any reason.

There is practically no remedy for illegal removal although law provides workers protection against unlawful dismissal.

The poor have also to brace the burden of ever-increasing prices of daily use items. The burden has been compounded by stagnant incomes during the last two years. It will be the poor and middle class that would judge the performance of this government when they vote the next time. Will this regime be able to please its main electorate by the time the elections are due?