THE National Economic Council (NEC), which met in Islamabad on Monday with Prime Minister Shehbaz Sharif in the chair, approved an indicative national development plan worth Rs.3 .729 trillion for the next fiscal year to increase the economic growth rate to 3.6 percent from the current 2.4 percent. It cleared a more than 47% increase in the federal Public Sector Development Programme (PSDP) to Rs1.4 trillion compared to the current year’s Rs.950 billion. The NEC revived the budget for the parliamentarians’ schemes and approved a five-year macroeconomic plan including a target to increase the country’s exports of goods and services to $63 billion by 2029 besides fixing the inflation target at 12%.
The NEC is the top decision-making forum in the realm of national economy representing all the provinces and, therefore, its consensus decisions augur well for the country. In a welcome development, the Prime Minister constituted a Committee to firm up recommendations to make this forum more effective and vibrant. The developmental allocations have the potential to spur growth and boost economic activities in different parts of the country, affording job opportunities to people at their doorsteps and fulfilling aspirations of the local communities vis-à-vis socio-economic progress. However, it is also a fact that the developmental allocations are no longer considered sacrosanct and become victims of repeated cuts during the year in the name of savings. It is because of these cuts and lower spending that only nominal developmental activities were witnessed across the country during the last several years. The revival of parliamentarians’ scheme has the prospects to take care of demands of the people but a comparatively small allocation of Rs. 75 billion is hardly expected to make any impact. As per general perception, such allocations are considered to be a sort of bribe to keep parliamentarians in good mood but in fact, sponsoring of local developmental schemes helps meet some of the urgent demands of the constituents. Fixing the inflation rate target at 12% also sounds good but given the inflationary effect of the IMF-dictated policies and their continuation in the new year puts question marks against this target. No nation can progress without necessary investment on education and with this in view the decision of the NEC to allocate Rs.32.8 billion for the sector, indicating 285% increase over the outgoing year, is also a step in the right direction. The allocations for higher education have been reduced which shows research and development has no priority in this country. Similarly, the target to double exports in five year is also modest and shows our lacklustre approach to boost local production and thereby exports. We say so because sky is the limit if the right kind of policies are formulated and pursued to modernize our agriculture and develop the IT sector as per demands of the global economy.
