Good governance is the key to ensure economic development and prosperity in peaceful and stable political environment. Ground realities substantiate that the new coalition government have great responsibilities. The country is confronting internal and external challenges. Tackling the surging terrorism, lawlessness, unemployment, sky rocketing prices, non-access to basic health facilities, residential problems in urban areas, shortage of water resources and clean drinking waters paucity, threats to agricultural economy, gas shortage and power crisis, trade deficit and fall in exports targets require immediate but lasting solution. The coalition government with the backing of masses is in a position to give priority to these issues. The reported 20% increase in inflation in prices of 22 essential items including wheat flour, rice and pulses in week ended on 10 April was hard hitting for the lower income people. Nevertheless, one should hope that any viable decision with regard to restoration of judges would also help in giving boost to economy.
The Finance Minister has already warned of any cushion to provide usual 15% increase in the budget. The Ministries and Divisions were being directed to seek minimum funding requirements for the next financial year. Reason is the declining revenues and critical economic situation. The new government is committed not to seek any budgetary support from the World Bank and IMF. No doubt, acquiring foreign loans is not a solution to national economy. Debt liabilities are causing serious problems to national economy. According to Financial Minister “over 70 billion dollars of loans were acquired over the past eight years by the previous government, but do you see any positive impact on the economy”. Surging prices of consumer goods would be a pendulum to assess the government’s performance. Re-emergence of fresh flour shortage after the acute winter food short need immediate control. The hoarders and speculators be kept under jaundice eye to obviate any further crisis. News about flour shortage in the country’s granary-Punjab is not good. One should not be cynical and presents gloomy prospects about new political leaders to take the country out of the economic crisis.
People have eyes on their leaders as to how much improvement the new parliament may be able to show in terms of (i) attending the parliamentary business with seriousness of purpose; (ii)quality of debate; and (iii) observance of the rules and procedures. Consideration of issues and new legislations would be a message as to how the country’s economy could be developed. The culture of democratic approach is strengthened. The PPP, PML(N) and ANP coalition have no alternative but to work productively. Report about government response to International donors not to follow their advised economic reforms is encouraging but need good homework before taking any decision. There should be no rhetoric. Pragmatic and feasible measures would be needed to ensure visible change and steer the country out of the economic slum. The donors’ institution wants continuation of policies for better GDP growth over the next few years. On April 10 the Asian Development Bank announced a new long term strategy framework for 2008-2020 to move Asia and the Pacific to a higher level of economic development. More than 600 million people in the region live on one dollar a day. And the strategy is aimed to contribute in global and regional welfare. Achievement of the target will needed an estimated 4.7 trillion dollars over the next year for regional infrastructure requirements. It’s a fact, no country of the world has so far achieved any real development by acting upon the recipes suggested by the international lending agencies. The new government has informed the Bretenwood institutions of the state of economy and long/short term corrective measures, Pakistan needs in the coming years.
The Prime Minister has also called for lowering excessive governing borrowing to reduce inflationary pressure. It is indicative of new government’s sensitivity to put the economy in right direction. Strong banking system is an essential ingredient for a vibrant economy. Certainly, effective control of inflation will greatly contribute towards sustainable economic development. Micro-credit facility is the best tool to generate economic activities, reduces poverty and improve living standards. The government also wants to increase the volume of agricultural credit facility to the farmers. Agriculture role in our national economy is vital. Its energizing means reduction in poverty, increase in income more employment, food sufficiency and more exports. In addition to economic challenges, securing the existence of the national assembly and future of democracy is also a big challenge. Sovereign parliament, stability of people elected government is the foundation on which the edifice of economic and social development can be erected. Political maneuvering, difference of opinions and compromise in the national interest is the spirit of democracy. Good governance and statesmanship quality ensure continuity of long term policies. Internal/external policies are not change with the government. The ultimate purpose is protection and promotion of national development targets. Democracy is a gift. If the people representatives betray or deceive their voters then the outcome would be nothing but a mirage. May be some cynics say that the parliamentarians should concentrate on poverty, inflation and fighting the curse of terrorism. They should not bog down in constitutional issues. Economic development is possible when political stability is established. Not to repeat the past mistakes is essential for viable democratic culture and pushing the economy upward.
Majority of the cabinet and parliament are mediocrities. One should hope that the new leadership with coalition partners would formulate policies and make legislation to ensure political stability, economic development, social justice monitored by free but responsible media. Resolution of the issue of provincial autonomy would be another landmark to achieve the development targets. Media should prove itself a good communicator between the public and the government. Politics and economy are inseparable. An imbalance may disturb the whole structure. It is necessary that pillars of the governance are allowed to work within their specified areas of responsibility. Judicial autonomy without being subjected to the whims and wishes of those who wielded political powers would ensure sustainable economic development and should remain the priority of every government. Important thing is to improve the income of common man and regional wealth distribution. Common man is least interested or convinced by the juggernauts of showing high percentage of development. They are more interested as to what they have been given.
Poverty in South Asia is a fait accompli. According to ADB’s estimate, 1.7 billion people are poor and measured against the 2 dollars a day benchmark. The percentage could full to 2% by 2020, provided the current rates of GDP growth per capita are sustained. Additional effort to ensure poor participation in benefit and contribution to the growth process.High exports and less imports is the index of national economic growth. More than 13.476 billion dollars trade deficit during the last nine months against 10.041 billion dollars recorded last year is not encouraging. Reason for surging trade deficit is oil prices and high import of consumer goods.
To bring the economy out of backwardness and set it on trajectory of growth, the government should concentrate on (i) marshall the domestic sources for investment to reduce the reliance on external capital to facilitate high level of GDP growth, (ii) tax the rich more than the common man, (iii) actualization of land reform and (iv) vesting greater powers/authority in provinces. Form of government whether unitary or federal is not important. Intentions of those in powers matters. The incumbent leaders have the responsibility to facilitate clean and honest administration, viable reforms in the institutions, social justice and economic development. Set a more realistic direction of foreign policy. In addition, the sitting parliament has a women Speaker. Utilization of women capabilities in economic development. The last but not the least factor for economic development is to throw away the tradition of “dirty politics” i.e. power took primacy over promises, to a dustbin.
Source: Pakistan Observer, 15/4/2008