With an increase in development spending is the economy poised for growth in the year 2020? The News on Sunday sat with Asad Umar, Federal Minister for Planning and Development and Special Initiatives to discuss the role his ministry might play
The News on Sunday: It is said that failing to plan is planning to fail. In the past couple of decades, even before the 18th Amendment, we saw a decline in the performance of the Planning Commission of Pakistan (PC) and the ministry for Planning and Development. What do you think led to the decline of an instituting which was supposed to plan and lead development vis-à-vis economic growth in the country?
Asad Umer: If we take stock of last three decades, we see that the country has been perpetually in IMF programmes which demand that the recipient work in a tight straitjacket. The Ministry of Finance, in its role of implementing the IMF programme, automatically became the single coordination point for the government and various stakeholders. It acted as a pivot around which all decision-making revolved in accordance with the IMF programme. Also, the general attrition of the quality of our governance system over these three decades not only resulted in the weakening of state institutions, including the Planning Commission, but also led to the deterioration of the system. The role of the Planning Commission in appraising and scrutinizing development projects and approving development funding was bypassed with decisions taken by executive fiat and on political directives, which I earnestly believe must have been made with the best interest of the country at heart but without professional scrutiny. This neglect led to decline in the Planning Commission’s capacity.
TNS: Your response supports the opinion of a former energy member, who in a recent op-ed mentioned that there is no evidence that there was adequate scrutiny by the Planning Commission. What are your findings on this issue and how do you plan to synchronize your ministry with modern times?
AU: I agree that it was due to inadequate scrutiny and rubber-stamped approvals that many projects faced massive overruns and delays. Recently, the Prime Minister’s Inspection Team studied all the big projects from the past decade and the result was an astonishing 150 percent overrun, proving that enough thought wasn’t put into preparation. So, in light of this report, the planning process is high on my agenda, I’m determined to overhaul the system. If we invest more time in the research and feasibility phase of a project, we earn dividends in the form of saved cost and time in the implementation phase. We’re implementing this strategy on the Main Line 1(ML1) project. In order to get the project completed in the stipulated time frame, we took our time in conducting the feasibility report. Once it was completed, we hired a consultant to look into the feasibility report and tackle any loopholes that could delay the project once it started. Similarly, we’ve finalised our six-month objective (from January till June 2020), which revolves specifically around getting the quantity and quality of professionals and providing them with the right tools and resources to carry out work for PC. Modern times demand that we empower and protect these who are willing to bring value to the public sector so that they don’t lose their sheen.
TNS: We are witnessing a haphazard pattern, with provincial and federal governments working separately rather than in tandem. With respect to meeting the UN SDGs by 2030 do you think the Planning Commission should work for a uniform approach?
Unlocking Pakistan’s potential is a subject close to my heart, and includes tapping the mineral resources. For me it’s a been-there-done-that situation. When I was heading ENGRO, I pushed for public-private partnership when we were taking up the Thar coal project.
AU: Since the SDGs are to be implemented by provincial governments with assistance from various federal ministries the key is to have a strong coordination mechanism in place. Even though we have an SDGs unit within the Planning Ministry and we do reach out to provinces and other ministries, due to the urgency of the matter, I believe we need to raise the bar. We’ve recently proposed a subcommittee under the National Economic Council (NEC) which will take a holistic approach in specifically monitoring SDGs-related work across the country. The idea is to set up a coordination mechanism at the highest national policy level to take along all stakeholders in order to achieve the SDGs in an integrated approach.
TNS: There is the notion that the federal government and the government of Sindh haven’t addressed the issues of Karachi. Do you think that country’s economic hub should be a test case for the working of the federal ministries with provincial and city governments?
AU: I have said it before and I will say it again, there should be no politicking on development issues. The problem of Karachi, or for that matter any other metropolis of Pakistan, isn’t what the federal and provincial government is doing for it. Do these cities truly have an empowered local government set up as reflected in Article 148 of the Constitution of Pakistan? Cities require local ownership; development requires local ownership. As far as development funds earmarked for projects in Karachi are concerned, we’ve already released them this month and have assured the provincial government that the Centre is willing to extend continued support to these projects.
TNS: Recently, you reiterated the prime minister’s words that the economy will be stabilised this year. People are dubbing this another pie-in-the-sky situation for your government, how are you so sure?
AU: I’m on record having said this back in September 2018 that 2020 will be the year for our growth trajectory to show an upward trend. With the current account deficit down by 75 percent I think stabilization of the economy has started taking effect. As per the advice of the prime minister, we have already released PKR 126 billion in development funds of to various ministries and provinces in the month of January. I am confident that by the end this year people will witness an uptick in our growth trajectory.
TNS: You’ve been assigned the Natural Resources Sector with an added portfolio for Special Initiatives. The prime minister in his talk at Davos mentioned tapping the country’s mineral resources. Considering mineral resources is a provincial subject what’s your strategy to kickstart this initiative?
AU: Unlocking Pakistan’s potential is a subject very close to my heart and I think this also includes tapping the mineral resources. For me it’s a been-there-done-that situation as back in the day when I was heading ENGRO, I pushed for the public-private partnership model when we were taking up the Thar coal project. We would encourage foreign investors into Pakistan to invest in this sector but I’d prefer to engage our local investment community to take the lead. Agreed that mineral resources are a provincial subject, provinces require help from the Centre to market this untapped resource to a wider audience. If required, we shouldn’t shy away from asking the state institutions to play the role of a catalysts to jump start this activity. The federal government plans to support every province in whatever way required to develop this sector and bring it at par with international best practices.
The writer is a freelance contributor based in Lahore