PM's Finance Adviser Shaukat Tarin has described the Pakistani economy as on the road to recovery, with the government having taken measures to bring inflation down to single digits in the next year. While delivering the keynote address to a discussion, 'The Future of Pakistan: Economic Recovery and Competitiveness' at the Asia Society in New York, Mr Tarin said that inflation had come down from a high of 25 percent in October 2007 to less than 15 percent in May. Extrapolating from these figures, it was relatively simple to come up with a single-digit inflation figure by the beginning of the next fiscal year in July 2010. However, Mr Tarin should remember, even when speaking to foreign audiences, that high single-digit inflation is virtually as bad as low double-digit inflation. Mr Tarin would be aiming his remarks at potential investors and lenders, who would not look at the inflation figure except as a pass-through item which would be passed on to the consumers. Investors would only require that inflation not be so high that it would need an endless round of investment. Even present inflation, which is punitive for the ordinary consumer, has not yet reached that point. Another point that Mr Tarin made, about taxation, is of more relevance, both to the ordinary Pakistani, as well as the potential investor, foreign or not, and that is the need to broaden the tax base, because revenue collection does not match the tax-to-GDP ratio. He promised much-needed reforms in this, and promised that 'no-go areas', such as agriculture, would be taxed. However, there was no sign of such taxation in the Budget just presented, indicating that the feudal lords had prevailed, along with the barons of the stock market, among other sacred cows, and prevented taxation falling upon them. Mr Tarin cannot make his sums work out unless he is able to impose greater fiscal discipline on the present coalition government, and prevent its ministers from indulging in the kind of extravagance that gives democracy a bad name, and which is inappropriate at all times, but especially when times are bad, as at present, when the government is facing global banking and commodities crises.