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June 23, 2021

Balanced budget?

 
June 23, 2021

This refers to the article ‘Holes in the budget’ (June 20) by Dr Farrukh Saleem. The 2021-2022 budget ignores the critical challenges that the country is currently facing. Instead of taxing the rich to cover the budget gap, the government is planning to borrow a massive amount of Rs3 trillion from banks and non-banking institutions. The current figure of expenditure shows that the government has abandoned all austerity measures. A liberal import policy with no restrictions on the entry of luxury and non-essential goods is still in place – and is wreaking havoc on the economy. The country’s exports are likely to cover only 50 percent of the total imports, giving rise to a large trade deficit. Some of the targets are highly optimistic – and even exaggerated.

The revival of the underperforming agriculture sector cannot happen without the intervention of the government. The authorities also need to promote high-level manufacturing to turn Pakistan into a country which produces a great quantity of finished products. One had expected that the government would announce a comprehensive and long-term policy to revitalise industries and the agriculture and export sectors. However, the government didn’t introduce any long-term policy. There is a dire need to shift domestic investment from real-estate to agriculture and industries. Unfortunately, fertile agricultural land is being used for building housing societies. Pakistani industries are limited to the assembling and packaging of goods. There is no doubt that the current budget favours the rich and offers nothing to the unprivileged. This segment is more likely to bear the brunt of rising inflation. It is feared that if effective steps are not taken in a timely manner, the country will remain an import-dependent state.

Erum A Baig

Karachi