Since the present government took over, the hardest task undertaken by any of its functionaries was by Miftah Ismail. As finance minister, he had to negotiate with the IMF for a grant of loan. Without a loan, a serious threat of financial default existed. Knowing our financial situation, the loaning organisation dictated its terms.
And meeting the terms and conditions of the IMF amounted to making the most unpopular decisions politically. When prices of petrol, gas, power and other commodities of daily use were raised, people had to blame the political party in power. And Miftah Ismail, as the point man, was destined to be a convenient scapegoat. Someone else in his position would have faced the same situation. The irony is that he had to face the criticism of his party members for taking decisions under the IMF dictates, which ultimately made the party unpopular among the masses. The critical choice: Either prevent the country from economic default or keep the people happy by not escalating the prices of utilities and commodities of everyday use.
The problem is that the majority of the people, including many educated among them, do not understand the complications involved in obtaining foreign loans nor do they know which segments of the society accustomed to high living cannot survive without loans. In fact, after the disastrous economic policies followed by the PTI during its stint in power, the PMLN blundered by taking over the government. Understandably, the core circle of the party was not in favour of the party being in the government, as it had to take extremely unpopular economic decisions to stave off economic default and earn public wrath as a consequence. But some PMLN politicians couldn’t wait to enjoy ministerial positions and fly flags on their cars.
It must be shocking for the taxpayers to know that PIA’s loss in the last ten years amounts to Rs580 billion.
However, to cut losses incurred by the state-owned organisations year after year, the present government decided to sell the shares of these entities by negotiating with interested foreign investors. The government decided to circumvent the Privatisation Commission to expedite the process. A Cabinet Committee on Privatisation decided to negotiate with other governments interested in buying shares of state-owned entities without involving the Privatisation Commission.
Apparently, it is Miftah Ismail’s brainchild, but it couldn’t proceed without the approval of the prime minister and his inner circle. It may appear to be a complicated arrangement for the people to understand, but the nation should be happy as long as we get rid of the loss-making dinosaurs like the PIA and the Pakistan Steel Mills. The finance minister will make history if he manages to get rid of both loss-makers – the bottomless holes eating away public taxes.
As reported, PIA, the national flag carrier, quoted a loss of Rs50 billion in 2021. Its first three-month loss this year runs into Rs14 billion. It must be shocking for the taxpayers to know that PIA’s loss in the last ten years amounts to Rs580 billion. The airline along with its assets, especially the Roosevelt Hotel in New York, must be sold to private investors as soon as possible. The centrally located hotel has become an albatross around the collective necks of the nation.
As well, it’s in place to recount for public consumption the brief history of the Pakistan Steel Mills, as narrated by an official. The PSM started production in 1985 and made a profit of Rs9 billion in the initial few years. This was the first and last good news about the mills. In 2008, the mills suffered a loss of Rs26 billion. From 2008 to 2014, the government injected a bailout package of Rs59 billion. Whose billions were these if not the taxpayers’? But the mills never recovered and haven’t produced a piece of steel since 2015. Yet successive governments have been generous to their employees who have been getting their salaries amounting to more than Rs380 million every month. Simply put, the Sharif brothers are seasoned industrialists. If any of their industries go in a loss every year, will they retain it? Big No.
Now we hear that the Gulf States agreed to provide $4 billion in financing to Pakistan. On one side we beg for foreign loans and on the other, we continue to embrace huge loss-makers – PIA and PSM. Also, the government must let the nation know about the powerful interests that won’t allow parting with the loss-making state entities. Who all occupy top positions in the PIA and PSM? Whose cronies and relatives are the beneficiaries? Is there any limit to nepotism?
The writer is a Lahore-based columnist and can be reached at pinecity @gmail.com