Monday August 08, 2022

‘Politicised economy deters structural reforms’

June 02, 2022

ISLAMABAD: Minister of State for Finance Aisha Ghaus Pasha on Wednesday said the much-needed and long overdue structural reforms to achieve sustainable recovery would remain a pipedream as long as the economy remains politicised.

“We have politicised the economy up to such an extent that is a disservice to this economy and the country,” Aisha Ghaus Pasha said while addressing a conference arranged by the Pakistan Institute of Development Economics (PIDE) on Research for Social Transformation and Advancement (RASTA) on Wednesday.

“No government can bring in proper structural reforms simply because of politicisation irrespective of the consideration that one party has to criticize whether it is making sense or not. Till we continue to do this we will never be able to undertake proper structural reforms.”

Pasha said there were too many lobbies taking the policymakers in the wrong direction.

“We all committed wrongs with the economy in the last 70 years and every stakeholder shared its responsibility as I should be bold enough that bureaucrats, military establishment, technocrats, politicians, and vested interest elites contributed to it. Let’s share responsibility and call spade a spade,” she said and added, “this is the malice in which we are just right now”.

She said Pakistan was dependent upon the IMF bailout package because it did not put its own house in order. “When we put our things in order, we will not accept any dictation. When we go to the IMF, we possess such a small degree of freedom we cannot negotiate well with the Fund, mainly because our house is not in order.”

She said that the path to sustained growth was a far cry as at the moment the stabilisation could not be undertaken in a proper manner.

In the existing situation of continuous point-scoring, no political party possessed the courage to take the right decision, Pasha said.

“We are ourselves to be blamed where we are on the economic front. Pakistan is in such a critical time that if we continue with our path, we will not have Pakistan that we have right now. I am not scaring you but just indicating to you as an economist where we are heading.”

She said many in the audience might share her concerns in this respect.

“ structural reforms could be done painlessly. All those policymakers who benefited in the past must realise there is no more rent to seek. Your rent-seeking has gone more as we reached a place where there is no further rent-seeking possible. As we are increasing the size and pie of the economy there is a need to shun my share and your share-related divide at this moment.”

This existing challenge on the economic front, she said, could be converted into an opportunity. “We need help from the media, civil society, and opinion-makers.”

The state minister for economy said it was a critical time and it should be converted into an opportunity.

“We should put ourselves in the right kind of frame into such structural reforms that can put Pakistan on the path of moving towards self-reliance. Let us join hands to devise such a plan that can steer the country from crisis mode. At the moment, we are not placing the needed reforms. We are not where we should be. The Charter of the Economy should be pursued and depoliticise the economy.”

She said every political party had to criticise the steps at 7 to 11 pm on TV shows irrespective of any consideration that these steps were necessary or not for overhauling the economy.

“Everyone is giving sweeping statements as people sitting on the media have become economic experts.”

She said justifying subsidy, which was financed through borrowed money, had impacted every one.

“We do need evidence-based policymaking. All the mistakes that were made provided much evidence that we did not make the right kind of policies at the right point of time,” she added.

Pasha further said something went wrong because the boom and bust cycle was not ending. Something had gone wrong and collectively failed to put things in the right direction, she added. She concluded her address saying whatever resources the country possessed at federal or provincial levels should be utilised effectively and in a transparent manner.