EDITORIAL: In a rare show of conducting a well-informed debate in the joint sitting of parliament Pakistan People’s Party’s Senator Raza Rabbani and Taj Haider, Jamiat-e-Ulema Islam-Fazlur Rehman’s Kamran Murtaza, Jamaat-i-Islami’s Mushtaq Ahmed Khan and Pakistan Tehreek-e-Insaf’s Ali Zafar prevailed to convince the Pakistan Muslim League-Nawaz to amend the proposed bill to amend Section 230 with potential of misuse/abuse by the Caretakers.
The following insertion as 230 (2A) is welcomed where in urgent matters and after the election schedule is announced would no longer apply “whenever circumstances exist which render it expedient for the caretaker government to take such actions or decisions necessary for the purposes of protection of economic interests of Pakistan dealing with bilateral and multilateral agreements with the international institutions and foreign governments, including continuation and conclusion of projects initiated under the Public Private Partnership (PPP) Authority Act 2017, the Inter-governmental Commercial Transactions Act 2022 and the Privatisation Commission Ordinance 2000.”
The insertion would now make it possible for the Stand-By Arrangement (SBA) with the International Monetary Fund to be tweaked, if required, in the event that a new government is not installed till December 2023, the first scheduled review premised on end-September 2023 performance/continuous criteria.
Two politically challenging SBA conditions agreed by the incumbent government should not require any caretaker intervention: (i) the raise in utility rates to be determined by Nepra and Ogra be promptly notified with the circular debt management plan hopefully in place before the dissolution of the assemblies; and (ii) any shortfall in 9.4 trillion rupee tax target (till 30 June 2024 though the SBA is scheduled to end on 12 April) as that may be announced through a statutory regulatory order by the Federal Board of Revenue as evident in its Tuesday decision to raise further tax from 3 to 4 percent.
This does not imply that such adjustments would not have implications on social unrest but that the onus would be on the outgoing elected government.
What should be a source of concern is the propensity of wasteful expenditure by Pakistani governments in general – be they elected or otherwise. What is important to note in this regard is the 20th July notification by the caretaker Punjab government, approving 3.2 billion rupees for purchase of new cars for assistant commissioners, additional deputy commissioners and additional commissioners – an example that not only reflects the insensitivity of senior bureaucracy to prohibitively high inflationary pressures that the general public is reeling from but also the penchant of administrations to engage in frivolous expenditure at the taxpayers’ expense.
The second SBA review is scheduled for 1 March 2024 with end-December 2023 performance/continuous criteria. The key factor here is, if elections remain pending till the time and an elected government not yet installed, then senior officials of relevant ministries, already in place and needless to add more in tune with the exigencies of the economy than a politician heading a ministry as shown again and again in negotiations with multilaterals, would have to engage with the Fund staff.
In recent months the coalition government has also engaged with bilaterals - including friendly countries – with respect to roll-overs and additional deposits which in terms of timing would take the country beyond the scheduled end of the SBA.
However, all pledges of investment inflows have not yet been inked and the amendment would rightly allow the Caretakers to continue and conclude projects initiated under the PPP Act or intergovernmental commercial transactions (purchase of LNG) or Privatisation Commission ordinance.
In addition, this insertion may be to provide protection and continuity to the Special Investment Facilitation Council, in which the Chief of Army Staff is a member of the apex committee and other army personnel serving as national coordinators of the apex and executive committees.
On 21 June 2023 Prime Minister Shehbaz Sharif tweeted: I have fervently advocated a unified approach to steer the country out of the economic challenges on a path to sustainable growth. Employing a whole-of-the-government approach, the coalition government has decided to set up a Special Investment Facilitation Council (SIFC) with a mandate to frame economic policies that ensure policy predictability, continuity & effective implementation to revive the economy. By virtue of its composition, the SIFC will serve as a top decision-making forum to push through fundamental reforms in the structure of the economy.
To begin with, the forum will focus on leveraging key sectors such as IT, agriculture, energy, minerals and mining, and defence production. Attracting investment from friendly countries remains one of the key goals of the SIFC. The immediate task is to increase FDI to $5 billion.”
This amendment to the Elections Act is a reflection of how parliamentary proceedings must be conducted and not as is the norm: rubber stamping the will of the ruling party focused on perpetuating its majority rather than working for the welfare of the general public.
Copyright Business Recorder, 2023