AS Finance Minister Muhammad Aurangzeb and Finance Secretary Chaudhry Imdad Ullah Bosal, in a briefing to the National Assembly Standing Committee on Finance, dwelt at length on conditions of the International Monetary Fund (IMF) hoping a package would be finalized soon, President Asif Ali Zardari lashed out at the Government for its handling of the IMF deal and reliance on loans. While accusing the PML(N) of failing to manage the Government effectively, Zardari apparently fired a warning shot by threatening that the PPP knows how to form and dismantle governments, adding the party would take decisive action.
As the PPP is known for its pro-people policies and approach, the concerns expressed by the President are understandable. He rightly pointed out that the IMF loans are a test for the general public as measures taken to fulfill conditions of the Fund have made lives of the people miserably and there is no end to this saga as more stringent conditions are being agreed upon for the future programme. The situation is so delicate that people are now resorting to street agitation because of the additional burden they have received due to prior actions that the Government agreed with the IMF but the briefing of the Finance Minister and Secretary Finance indicated much more was in store for the common man. The committee was informed that besides the prior actions set by the IMF including adjustments in electricity and gas tariffs and approval of a budget with a primary budget surplus of 1% of the GDP, the Government has also agreed on several structural benchmarks with the IMF, including increasing agricultural income tax rates, amending the Pakistan Sovereign Wealth Fund Act, privatisation programmes, reducing the size of the government, reforming State-Owned Enterprises (SOEs), ending gas supply for captive power plants and requiring civil servants in grades 17 to 22 to disclose their assets. As the next IMF programme is expected to spread over 36 to 39 months, there is no likelihood of any relief for the common man and implementation of the IMF conditions over this period would add to the woes of the people. In this backdrop, the remarks of the President become understandable and the PPP is apparently trying to win sympathies of the people for championing their cause. However, it is also a fact that the PPP adopted a somewhat similar posture during presentation and discussion on the budget in the National Assembly but at the end of the day it transpired that the pressure tactics were aimed at squeezing more for the party at the centre and in Punjab. It is also a matter of record that the President gave his prompt assent to the IMF-dictated budget, the passage of which was facilitated by his party. Keeping motives of the PPP aside, it is a reality that almost the entire burden of the so-called reforms has been put on the ordinary citizen. New taxes have been imposed and rates of others hiked to the disadvantage of the common man in the name of broadening of the tax base while structural reforms would also affect this segment of the society badly. The Finance Ministry has acknowledged that the unemployment rate in the country climbed up from 6.3 percent three years ago to 10.3% in 2024 and it would go up further as a result of the ongoing right sizing process, which aims at winding up ministries and departments to save expenditure. Similarly, civil bureaucracy would not get a traditional pension after July 01, 2024 and without elaborating further the Finance Minister has hinted at an overhaul of the military pensions within a year. Electricity base tariff has been hiked and fixed charges added despite strong protests by consumers and the impact of the decision will be felt when people receive bills next month. The Finance Minister expects a ‘slight uptick in inflation in coming months’ but the actual situation might be different due to the impact of heavy taxation in the budget. In a nutshell, neither economy has improved to the desired level nor condition of the common man, then what is the logic of going again and again to the IMF.
