Daily Times

Certainly the time has come for the political hierarchies ruling at the Centre and in the provinces to take stock of their acts. The causes they are presently championing so fervently and the fracas they are waging so stridently are enthusing no one on the streets. Issues of electoral reforms, constitutional reforms, civil and military relations and local bodies’ elections may be heated controversies in political quarters, media studios, civil society offices, the chattering classes and deluxe parlours but no one is talking about the people’s problems and woes. No one is even taking passing notice of them. However, the streets are thunderously silent and if the political hierarchies are real, they should be alarmed as the streets are likely to react over skyrocketing price spikes, galloping unemployment, corruption and the increasing crime wave. This will surge into a tidal storm.

This should make the political hierarchies sit up, for the people are angry and not just with the political class; they are becoming jaded with the very prevalent system. Whatever kind of sham democracy we have, that too is losing the people’s trust rapidly. They have to take serious notice of this public alienation and anger, and set about earnestly to tackle the underlying causes of the public’s disgust and frustration effectively to the greater satisfaction of the masses. It should be kept in mind that it is the kick on the stomach that hurts people the most. The issue of bread and butter means everything to the masses, and all else is just secondary. If the ruling hierarchies are at all wise, they must for a change stand up firmly to get cracking on the runaway price hikes and unemployment.

Sit-ins, dharnas (protests) and jalsas (rallies) are definitely no answers to these gigantic problems. Such events can bring media publicity and projection to the players but price hikes and jobs are serious matters that can be sorted out only with hard-boiled thinking, creative ideas and well-considered administrative measures. The federal finance minister is upbeat that foreign exchange reserves are at an all time high at $ 20 billion and that the inflation rate is very low but people are not interested in the foreign exchange reserves touching unprecedented heights. They do not wish to understand the terminology of inflation, which is said to be the result of “a lot of money chasing few goods”, Indeed, there are reasons for escalations in prices: injudicious management of crops, hoarding, black marketing, monopolies and cartels. Even the benefit of reduction in international prices of oil has not been passed on to the consumers neither by the government nor the businessmen.

Instead of giving relief to the consumers, the electricity and gas tariffs are being revised upwards and charges and various surcharges have been imposed to make their lives miserable. What people are concerned with are the ever-rising prices of food items and utilities, which takes a big chunk of their incomes, salaries and wages. The prices of almost all kinds of essential daily use items, such as wheat, flour, vegetables and other groceries, registered a manifold increase in the open market during the last few months. This high trend is also witnessed in the prices of pulses, increasing from 30 percent to 60 percent. It has to be said that wheat, flour and pulses are the mainstay of poor people. The government must take measures to reduce the prices of these essential goods.

A day before the announcement of the mini budget for 2015-2016, Federal Finance Minister Ishaq Dar unveiled the Pakistan Economic Survey 2014-2015, admitting that most economic targets had been missed. The minister had set an economic growth target of 5.1 percent in the 2014-2015 budget but a growth rate of 4.2 percent could only be achieved. The same is the case with the fiscal deficit and trade deficit. The government has not taken steps to increase exports with the result that there is a trade deficit of about $ 20 billion because Pakistan is exporting less and importing more. Exports are at around $ 22 billion and imports are at $ 42 billion, hence the trade deficit of $ 20 billion. After taking into account remittances of over $16 billion by Pakistani expatriates, there was a current account deficit of about three billion dollars, which had to be met through foreign loans and borrowing from the International Monetary Fund (IMF) and other international finance institutions.

During the last 68 years, Pakistan has had a current account deficit and had to fall back upon the IMF or loans and grants from other countries except only twice, once in the 1950s at the time of the Korean War boom and then in 1973 due to the oil boom. As regards to the fiscal deficit, it is due to the fact that Pakistan is earning less and spending more, with the result that the government has to take loans from commercial banks to keep the fiscal deficit within target. According to the 2015-2016 budget, total resources — tax revenue, non-tax revenue, other income and loans — have been estimated at Rs 4,168 billion. Current expenditure has been estimated at Rs 3,128 billion and, despite imposing new taxes, fiscal deficit is at Rs 1,328 billion. But during the first four months there was a shortfall of about Rs 80 billion in revenue collection.

The government has imposed additional taxes of Rs 40 billion on luxury items. But this will have an adverse impact on the prices of local products. When the prices of imported milk and butter are increased, local producers are likely to enhance their prices. To meet fiscal deficit, the government will have to borrow from the banks to meet the shortfall. The success of any planning depends on the extent to which it contributes towards the living standards of the people. Based on this benchmark, our planning has been a dismal failure. The prices of utilities and ever-rising prices of essential items erode the real income of the salaried and fixed income groups. The government should, therefore, focus on creating job opportunities and reducing the prices of items of daily use.

The writer is a freelance columnist. He can be reached at mjamil1938@hotmail.com