As the new government takes over with a lot of questions hanging over its legitimacy, the only way it can silence its detractors is to perform on the economic front. Sadly, with a rather poor show­ing on economic policies cum vision in its recently conclud­ed PDM stint, the confidence, at least for now, in its ability to deliver remain thin. Given that we are already in the month of March, trust the real litmus test would the kind of budget it sets in a couple of months’ time, which would not only be the key in determining its road map towards Pakistan’s econom­ic stability, but will also be critical to its survival per se. 

Regrettably, in recent years our op­erational management of the econo­my has been consistently slipping with Pakistani managers invariably ending up working against the natural region­al tide, invariably leading to growing disparity between the economic for­tunes of Pakistanis and most of their regional neighbours, primarily India & Bangladesh. As one keeps on saying that one does not need to reinvent the wheel, but simply follows the success­es that one sees around its comparable neighbourhood. 

Only last week the Indian Finance Minister, Nirmala Sitharaman, present­ed the sixth budget of her party’s cur­rent tenure and contrary to the expec­tations of many, with elections round the corner, her government did not waiver from a strict economic vision of the economy always coming first and that dole-outs or favours will be extended that compromise on India’s growth and development. Unlike the drag budget speeches at our end, she finished within an hour with a clear message that India remains on track to enter the club of 3 largest economies in the world. Just to reiterate from my previous piece on the subject that surely one can blame Modi and his al­lies for all sorts of crimes against hu­manity and for making a mockery of international rules and regulations, but as far as the Indian economy is concerned, his Sarkar seems to be tak­ing it to the next level.

Without getting into the nitty gritty, let’s try and analyse what the Indian budget mainly contained in broad pol­icy terms, while comparing, where pos­sible, with prevalent realities at home:

- Fiscal consolidation: A clear mes­sage to remain committed to the path of fiscal consolidation - in fact im­proving on the glide path to achieve a fiscal target figure of no more than 4.50% of GDP (gross domestic prod­uct) 2025-26.

- Renewing the footprint of develop­ment by further enhancing or expand­ing the private sector’s participation in order to draw operational efficien­cies and instil entrepreneurial qualities in the development initiatives. Unlike Pakistan where private sector’s foot­print on the economy is shrinking and the country is de-industrialising.

- To consciously bridge the gap be­tween annual revenue projections and real receipts and between laid-out spending with fixed cum inelastic ex­penditures. This is an exercise to not only be honest to the people in what the government can actually or prac­tically commit to the them, but also an endeavour to come clean and transpar­ent in managing the country’s financial affairs; something that will go a long way in improving the country’s image and repute as an ethical and reliable fi­nancial player in the international com­munity. Now surely, we could do with some introspection on these lines here in Pakistan as well.

- Adopting the assumptions, forecasts and projections on India’s economic growth those of external agencies and autonomous bodies, mainly IMF and the World Bank from the outside and the RBI (Reserve Bank of India) from the inside, instead of touting the gov­ernment’s own homegrown figures. This again would go a long way in dem­onstrating an arms-length strategy on accurately gauging India’s real poten­tial for growth in the coming year along with lending global credence to the budgeted lay outs. In addition, it would in advance lay a very strong ground for any financing needs that may arise over the next twelve months.

- Ensure that private sector’s capi­tal spending continues to both, out-spend and out-pace government’s cap­ital spending. Ironically, the opposite is true at home.

To conclude, whatever may be the case, the reality is that unless we here at home also somehow can en­sure to converge transparency, fiscal prudence and political economic vi­sion across all parties by putting the country first, sustainable, meaningful and equitable growth in Pakistan will remain elusive!

Dr Kamal Monnoo
The writer is an entrepreneur and economic analyst. Email: kamal.monnoo@gmail.com