TRUE to his commitment of taking concrete measures to put the economy on fast track growth, Finance Minister Shaukat Tarin, on Friday, unveiled an ambitious three-year economic programme, which has been evolved by renowned experts forming the Economic Advisory Council (EAC) with the objective of achieving higher and sustained growth.
Apart from accelerating the pace of economic growth from 3pc to 6pc in the next three years without creating pressure on balance of payments and by keeping inflationary expectations subdued, the plan envisages increasing tax to GDP ratio by 1.5 to 2pc annually, attaining target of $30 billion exports by FY 2023-24 and keeping up the momentum in foreign remittances.
The key focus is to generate massive employment opportunities over the period of time to engage the youth in productive sectors of the economy.
As the plan has the potential to address fundamental problems of our economy and put it on the path of accelerated growth, — objectives that are shared by all stakeholders — it should form the basis for the much-talked-about Charter of Economy to ensure its smooth and unhindered implementation.
As for the present Government, it has expressed its intention to implement it in letter and spirit as every Minister would stand before the Prime Minister on a monthly basis to report progress and be answerable for slippages.
In order to ensure professional handling of the plan, the Economic Reforms Unit of the Ministry of Finance would coordinate the progress review before the Prime Minister and the Pakistan Institute of Development Economics (PIDE) would provide experts to assist in professional reviews.
The seriousness of the plan is also evident from the announcement that performance in 14 sectors would be monitored from September, 2021 and the Prime Minister would be given a briefing about the execution of the plans every month.
This strategy, if followed honestly and diligently, is bound to produce positive results as monthly briefings to the Chief Executive would help remove bottlenecks and shortcomings, if any.
The sectors underlined for driving growth through the platform of the EAC are agriculture, including small farms, micro enterprises, small and medium enterprises, construction, tourism and information technology.
This would be achieved through coherent, consistent and well-coordinated policies between the federal, provincial governments and the private sector.
The medium and long-term agenda includes a multi-pronged strategy for institutional reforms in the public sector and the provincial governments will prioritize achieving universal access to quality education, health, access to drinking water and sanitation.
Similarly, the federal and provincial governments would enhance focus on human development and develop physical infrastructure which lags behind in far-flung areas.
The medium-to-long term planning also includes completion of China-Pakistan Economic Corridor projects, particularly in agriculture, industrial cooperation, socio-economic development and financial inclusion.
However, this should, in no way mean putting CPEC projects on backburner as their completion is a pre-requisite for provision of world class infrastructure to prospective investors besides ensuring uninterrupted supply of electricity and gas as well as smooth connectivity and mobility.
The most important and laudable part of the plan envisages reduction in foreign debt as the roadmap seeks to cancel drawdowns on wasteful foreign loans and two-year moratorium on foreign borrowings.
Pakistan’s external debt is assuming dangerous proportions as the country has to take more loans to pay back previous ones and the vicious cycle would continue if no tangible steps were taken to address the issue squarely.
A moratorium on fresh loans for two years and repayment of the existing ones during this period might lead to significant reduction in the debt burden of the country.
The plan also takes care of the chronic problem of circular debt as it seeks to reduce the cost of electricity generation by flattening the capacity payment curve through restructuring power producers.
This will be done through a combination of re-profiling of project debts and reduction in return on equity and operation and maintenance components of tariffs.
However, the solution is unlikely to work if no progress is made on improvement of distribution and transmission network and plugging of losses and prevention of theft through use of latest technology.
The measures aimed at boosting exports meaningfully would also help increase productivity, achieve diversification and create more employment opportunities.
As the plan implementation period goes beyond the mandate of the present Government, it would be worthwhile to take practical steps to enlist support of the opposition parties, which should not be a difficult proposition because of the intended benefits of the roadmap for the entire economy.