ISLAMABAD: Federal Minister for Planning Ahsan Iqbal said that corruption is not the primary reason holding back Pakistan's economic development, claiming that there are examples of countries that managed to progress despite similar level of corruption.
The PMLN leader indicated that the far bigger impediments to Pakistan's growth were "political instability and policy reversals" as opposed to corruption. He said that the country is heading towards brink of complete ‘bankruptcy’ so there is a dire need to sign Charter of Economy for ensuring continuity and consistency of the policies.
Addressing a seminar titled, ‘Grand National Dialogue 2022: Unlocking Pakistan Economic Potential’ organised by Islamabad Policy Research Institute (IPRI) here on Monday, Ahsan Iqbal delivered very sentimental speech and conceded that his generation was ashamed of for not delivering what the country deserved mainly because of political instability and inconsistency in policies.
He said that India and Bangladesh had lagged us behind on all economic fronts so there was a need of soul searching what went wrong on our side. He said that he had supervised Rs3,200 billion development funds from 2013 to 2018 and $29 billion projects under China Pakistan Economic Corridor (CPEC) and if anyone could prove corruption of 32 paisa or 29 cents, he should be declared national criminal and barred from participating in politics for life.
He said that one former minister alleged for getting kickbacks of Rs70 billion in construction of Multan-Sukkur motorway and as matter of fact it was Chinese side for selecting contractors then it resulted into slowing down of the CPEC in totality.
He said that the corruption is used as tool for political victimisation and he was thrown behind the bar for construction of Sports Complex at Narowal on a project which was approved before he got ministerial slot during the last tenure. He said that accountability process was used as witch-hunting against opponents and now the situation arose to a level where bureaucracy is not ready to sign contract of Rs10. The accountability process should be pursued on transparent and across the board, he maintained.
The minister deplored that he had talked about reducing usage of tea and it was made a joke. The trolling on social media has become new normal and economy is serious issue which should not be made part of our jokes, he added.
“The difference of opinion should not be used for hatred. The polarisation has reached its peak. I have still bullet in my body as hatred was inculcated into mind of young man. The fake news on social media is being used to promote hatred in our society,” he added.
The minister said that no investment could be lured until and unless we put our house in order, and that necessitates a consistent policy backed by all the stakeholders. He regretted that the BRI’s flagship initiative, CPEC, couldn’t take off in Pakistan to this day, owing to political bickering, unsatisfactory law and order situation and a trust deficit of sorts between various poles of power.
He recalled his previous government’s efforts in launching Vision 2010, and then again reviving the same policies in 2013 under the Vision 2025 strategy. He, however, said that they could not see the light of the day, and the result is an economic mess before us.
He said that political differences are appreciated, and a way to go in any pluralistic society, but not at the cost of vendetta. He observed that the budget for 2022-23 is no more than a nightmare, and there is hardly any funds at hand to carry on the business of the state as well as development. The enigma is that borrowing is needed to meet day-to-day expenses, and this is detrimental to progress. “The sooner we come out of debt trap and deficit economy, the better it is,” he observed.
He cited the examples of Bangladesh, Vietnam, Cambodia, Laos and Myanmar to make a point that these fragile economies grew because of a sustained approach, and by winning over the confidence of the international investment market. He pointed out that Pakistan’s Foreign Direct Investment is hardly to the tune of $1.5 billion, whereas there is a cash treasure floating around in the Asian markets soliciting competitive economies.
Ahsan Iqbal remarked that Pakistan has come down in the last 25 years, and we need to do some deep introspection for this failure. He said that high growth rate tempts imports, and this is where we fall in the trap of circular debt and current account deficit. He said that Pakistan is in need of export-led growth, and that too with a consistent decade-long plan of action. He called for a national consensus on economy, and invited stakeholders across the board to huddle together for bailing out economy, and rebuilding a sovereign economic edifice.
The seminar was also addressed by Haroon Sharif, former chairman Board of Investment; Dr Abid Suleri, Executive Director SDPI; Dr Usman Chohan, Director CASS; Maha Rahman, Director MHRC LUMS; Dr Ikramul Haq, Adjunct Professor LUMS and Dr Aneel Salman, Chair of Economy IPRI.
Former BoI chairman Haroon Sharif proposed decoupling of economy from the politics. He said that the structure of the economy was not right. He said that borrowing is not an alternative to investment, and investors are discouraged in regions of internal and external conflicts. He said that Pakistan has not been able to attract potential investors because of inherent flaws, and many of them pertain to our approach towards the capital.
Mr Sharif said that Pakistan's over-reliance on essential imports needs to change. “Policy inconsistently, lack of dispute resolution capabilities and conditions in-conducive to growth at large are challenges Pakistan needs to address,” he observed.
“It is our job to grow. A stable Pakistani economy is only in our interests -- foreign investors will only want their money back. We need to diversify our pool of aid. We are far too dependent on multilateral agencies controlled by the Western powers, Haroon Sharif lamented.
He said that the future of world finances is in Asia, rather than Europe. He categorically mentioned the Sovereigns Funds of Qatar, the UAE, Abu Dhabi, Kazakhstan and China that stand to the tune of hundreds and billions of dollars, and advised that they need to be tapped.
He gave the example of DIFC in the UAE, and said that investors should not be conditioned under national laws, and a system as in vogue in Dubai should be introduced for investors and setting up economic zones.
Dr Ikramul Haq spoke at length about the trial and error story of the taxation system in Pakistan. He eloquently made a case as to how provinces and the federation had been at odds, and how a system is yet to be designed for fair collection of revenue.
He told the participants that the real dilemma of the taxation lies in in its dichotomy in vogue. He said that businessmen claim that they want to pay taxes properly, but the FBR often acts as an impediment.
This is why allegations of institutional harassment on the part of FBR, and the lack of a speedy redressal system needs to be addressed. He said that sales tax is a textbook example of dishonesty in our taxation network.
Dr Haq remarked that the judicial system also needs to be revamped. “A national tax court rather than multiple hearings from multiple courts will help in judiciously furthering a smooth flow of taxation,” he observed.
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