PM’s Gwadar speech
DESPITE best wishes, following steps are required for the progress of Baluchistan and Pakistan. The announcement of Rs730bn development funds is a positive step.
But keeping in view the history of corruption in the province, these new funds should only be released after satisfactory result of audit reports of previous funds.
It is the public right to know how their tax money or loans taken in their name are utilized on ground. The public is suffering from high cost of living due to loans, interests and inflation.
The PM has to change his export vision. There is a need for alternate options to deal with emerging geo-strategic and geo-economic challenges in the region and beyond.
Pakistan will have to use multi-pronged policies that are flexible, nationalist and futuristic at the same time to amicably deal with its neighbours, region and global powers under Pakistan first approach without undermining its economic, public and national interests.
The export model of the West has failed in which the government gave private businesses subsidies, tax incentives and bailouts through one window operation because it only increased profit of private owners instead of improving state revenue, jobs and economy.
The case in point is the $100bn bailout package to the private airlines (US$50bn & EU €26.6bn).
As per the New York Times article “Were the airline bailouts really needed” dated March 16, 2021, the US airlines got $300,000 per job from taxpayers for 75,000 jobs.
Biden removed $11bn levies on private businesses of Airbus and Boeing and cut corporate taxes but increased taxes on American public to run the country.
Things are the same in Pakistan. Government export policy has fuelled mega corruption, debt and inflation in the last three years.
Out of 2019, $52bn import bill, more than $21bn were used for private sector imports of cotton ($3.4bn), Steel & iron ($3.9), food items ($4.7bn), and agriculture & other chemicals ($8.3). Its subsidies for textile $8.5bn (2019-25) and energy ($4.1bn) should stop.
The government should instead develop local industry, agri and service sectors to cut imports, create jobs and improve the economy. It will increase revenue, foreign reserves and bring exchange rate under Rs.100.
The job of the government is to help the public sector and facilitate markets not mafias. According to Bloomberg, China used public savings to build roads, railways and ports.
President Den Xiaoping allowed foreign investors in 1979 but the foreign firms had to set up businesses with local partners with transfer of technology. As a result, the economy grew 90 folds in four decades.
The Central Bank is kept under state control to use government banks and public savings for nation building.
The majority of the population in Balochistan lacks basic amenities. They have the highest poverty rate and infant and maternal mortality rate, and the lowest literacy rate in the country.
The best way to help the population is to use a combination of land ownership on lines of US Homestead Law, value addition with help of IT and SME by turning villages into special economic zones (SEZ) at a fraction of the cost.
To avoid corruption, government banks, NSC and Postal Services should deal with tax money loans down to the grassroots instead of private organizations or individuals.
The judicious use of the funds can bring the following benefits. The provision of internet and IT in existing population areas will help start virtual markets translating into immediate jobs.
The small and medium industry will add value addition to different items, products (dairy, meat & poultry), and produce (farm and agriculture).
The use of renewable energy, agri-dams and infrastructure will help accelerate the process to help the public earn a living and secure it in national interest.
After the 18th Amendment, it is the responsibility of a provincial government to help its people in education, health and jobs as part of good governance. With almost half of the total area of Pakistan, Balochistan has the lowest population.
It needs more people to improve its economy. China lifted 700 million people out of poverty by relocating them to different parts of the country.
The economy of Baluchistan can also be improved by relocating 3-4 crore people from other parts of the country.
Historically, Roosevelt used the New Deal following the Great Depression to create jobs and restart the economy with the help of a domestic consumption-based economic model. It made America super power in five decades.
China has used similar steps to become a global power in just four decades. The PM and Army chief have sent positive messages.
Balochistan should use this positive atmosphere to bring the province at par with the rest of the country and improve security of Pakistan in the region.
The situation of Balochistan is both an opportunity and a challenge. The successes of America and China have shown that unity of purpose can help build the economy, bring prosperity and bolster security.
History is very important but it cannot be upheld at the cost of public prosperity and progress. The democratic institutions protect the weak against the strong in democracy.
It is democratic responsibility of the government to provide good governance for the benefit of the public, security and peace.
—The writer is senior political analyst based in Islamabad.
