Political leaders and economic challenges

Pakistan faces complex challenges that are not insurmountable provided the political and societal elite, especially the major political parties and leaders, are willing to acknowledge them and work towards adopting a more or less shared approach rather than seeking partisan political mileage by trading charges and counter-charges. Although all the major political parties are in power, either at the federal level or in the provinces, each party holds the other responsible for Pakistan’s current predicament.The attitude of different political parties towards the flood tax and revised GST shows that most political leaders are not fully conscious of the gravity of our economic situation and do not want to look beyond their immediate party interests. They are also not conscious of the message the political wrangling on the tax issue is sending abroad.

Whereas the Pakistan government is seeking financial help from the UN and individual countries for coping with the devastation caused by the recent floods, Pakistani political leaders are not willing to shoulder the responsibility. They are more interested in challenging the federal government rather than examining the reasons that have led it to approach parliament with new tax proposals.The federal government’s partners like the MQM, the JUI-F and the ANP are also expressing varying degrees of reservation on the tax proposal. The MQM appears to be more vocal. Its political style is such that it wants to enjoy the advantages of power but if it realises that a certain policy measure is going to be unpopular, it starts talking like the opposition without leaving the government. Another feature of its politics is that if the party chief, Altaf Hussain, takes a position on some issue, other leaders repeat exactly the same argument until the chief changes his stance.The JUI-F and the ANP have been low key in their criticism of the tax measures. The best course of action for the federal government would have been to discuss the tax matters first with the allies and then move the bill. It seems that the PPP leaders are not fully sensitive to the imperatives of coalition management. Their personalised decision making often creates unnecessary problems. The PPP leaders should be more interactive with their coalition partners.

The PPP needs to work closely with the coalition partners because its domestic problems have increased over time due to poor governance, including a weak response to the post-flood problems of rehabilitation and reconstruction and a steep price hike that is hurting the common people. The general perception is that the government is unable or unwilling to crack down on different powerful industrial and business/trader groups that have virtually created monopolies to manipulate the supply of essential commodities to increase their prices.One food item that is manipulated from time to time is sugar. It is interesting to note that in September 2009, the Supreme Court upheld the decision of the High Court to fix the price of sugar at Rs 40 per kilogramme. In early November 2010, in some cities, the sugar price went up to Rs 120 per kilogramme.The federal government should pay attention to two issues. It must be more transparent on the issue of price hikes of food items and utilities like electricity, gas, petrol and diesel. The most problematic aspect of the steep price hike is that it transfers wealth from the weaker sections of society to a small number of powerful economic barons who use it to amass political power. This creates close links between the powerful economic mafias and political power and increases economic inequities in society. Even if the PPP is not the direct beneficiary of this ‘financial plunder’, it cannot escape its cost in terms of losing popular support.

The second issue that the federal government should address is the need for strengthening the consultative process with its allies so that they stand by it in all difficult situations. If the government has nothing to hide, it needs to be more transparent on the current economic problems and take the allies on board before adopting any financial measure.The opposition parties, especially the PML-N, need to recognise that mere criticism does not serve the purpose. The opposition leaders should come out with practical and concrete proposals to cope with the current economic problems like a heavy reliance on external financial support, how to address the economic fallout of the recent floods, the impact of religious extremism and violence on the economy and how to manage price hikes.Currently, the PML-N’s major interest is to exploit the difficult economic situation for mobilising the people against the federal government. It is accusing the federal government of all the ills and deficiencies in Pakistan’s politics, economy and foreign policy. Its leaders think that the negative message at the international level does not threaten their immediate interests. Rather, it discredits the federal government that has to deal with the international community. If the federal government is reprimanded by some forum at the international level or fails to obtain economic and diplomatic support, the PML-N gets additional reasons to hold the federal government responsible for the alleged foreign policy failure.

The PML-N and other opposition leaders are demanding of the federal government to check corruption and reduce administrative expenditure rather than seeking the approval of parliament for its tax proposals. They are making this argument as if corruption and poor governance started in Pakistan with the coming into power of the PPP-led federal government and that it can end corruption instantly.The PML-N ignores the fact that it is ruling the province of Punjab where corruption is as rampant as in other parts of Pakistan. As a matter of fact, Punjab houses about 58 percent of Pakistan’s population and, had the performance of the Punjab government been better, there would have been less hue and cry about corruption and price hikes.The PML-N needs to adopt a realistic approach towards Pakistan’s current socio-economic problems. It should either come forward with new concrete proposals or work with the government to address the economic crisis. They will have to work together to fight corruption. Their failure to do so will have wider implications than discrediting the PPP. It will be viewed as the failure of the entire civilian political elite to rise above their partisan interests and create a viable civilian alternative – Dailytimes – Dr .Hasan Askari Rizvi