The government of Prime Minister Nawaz Sharif has presented a fifth consecutive federal budget. While there can and will be an intense debate about how effective or ineffective is the maths this year — as is the case every succeeding year — the one for the next fiscal 2017-18 carries a certain landmark in that it is the first time in the country’s history that an elected government has scored as much, a fact Federal Minister Ishaq Dar was not shy of driving home on Friday to underscore the traction gained by Project Democracy.
There were other milestones in the record Rs4.75tn budget, too. With the volume of the country’s economy breaching the $300bn mark; the growth rate of GDP spurred to 5.28% — the first time it has crossed the 5% mark in a decade. The deficit has also decreased to 4.1% of GDP with a recommendation for an ambitious 6% in the next fiscal.
Dar disclosed that tax collection had seen an 81% growth in the last four years; remittances from overseas Pakistanis jumped 40%; services sector hiked 5.9% and the industrial sector 9%; and per income capita increased by 22% to $1,631 during the current fiscal. The foreign reserves stand at $21bn.
Reading from a 71-page document on the floor of the National Assembly — lower house of Pakistan’s bicameral legislature — Dar claimed that looking back few would have conceived the “economic turnaround” that his government would author but that now world’s leading international ratings agencies like Standard & Poor’s, Moody’s and Fitch have raised the ratings for the country. 
Declaring that Pakistan “will be one of the largest economies by 2020”, Dar also referred to how the “world’s credible institutions are predicting that Pakistan would join the G-20 by 2030”. Despite financial constraints, he noted that the country’s growth rate had been better than the global average in the current fiscal. 
But what takes a place of pride in the upward curve is the performance of Pakistan Stock Exchange, which is set to be upgraded to MSCI’s Emerging Markets Index from 1st June. In the current fiscal, the Pakistani Stock Market has performed the best in Asia and the fifth in the world. The Karachi Stock Exchange-Index, a benchmark for market performance, soared to 40% in the current fiscal year to date.
According to the National Clearing Company of Pakistan Ltd, the market recorded trade transactions of more than $41bn during the review period. 
Similarly, the agriculture and industrial sectors, too, saw noteworthy surge. The former posted a growth of 3.46% in the current fiscal - the highest in the last half a decade. Other sub-sectors like livestock, forestry and fishing posted a growth of 3.43%, 14.49% and 1.23%, respectively.
The industrial sector made a robust gain of 9%, lower than last year, but still higher than the average growth of the last half a decade. It will see tremendous boost in the near future with an increased budget for public sector development and massive projects as part of the China-Pakistan Economic Corridor (CPEC). 
On the flip side, the annual Economic Survey, which gives an overview of the economic performance over the previous year shows the government was far from having met its targets. The trade deficit, for example, has widened to $24bn against exports worth $21.7bn only. 
The finance minister put that down mainly to the cost accrued by import of heavy machinery under the CPEC with the hope that the investment would pay back in the long term. But, as one observer pointed out, most of this equipment has been purchased through loans and if the loans are to be paid back, there will be a definite need to expand the export base. 
And not all is not milk and honey as would be expected for a country combating serious security challenges on both its eastern and western borders. There is, of course, the internal dimension of the war on terror and extremism as well. Dar revealed that the terror war losses had swelled to $123bn with the outgoing fiscal alone accounting for $3.9bn. However, on the positive side, this figure was markedly 40% less than the year before and the lowest in any single year over the past 12 years - signifying major gains from the military operation Zarb-e-Azb against terrorism. 
But the elephant in the room of the past decade - the energy crisis - is about to be fully addressed in the near future, according to Dar. From the prime minister to every minister, they have held the promise that the issue would cease to exist next year - likely to be the chief plank for the ruling party in an election year. But not everyone agrees.
“The problem of the power sector continues to be misrepresented as one of adding power capacity. In fact, the issue is one of structural reform, which the government has shown no seriousness in tackling. Circular debt has spiralled up to the levels we saw in 2013,” The News, Pakistan’s leading English daily, warned in an editorial last week.
To meet this onerous challenge and the like, perhaps, the time has come for a ‘Charter of Economy’ to forge consensus around key economic policies as admitted to - and appealed for - by Dar. Considering such an appeal was also made by the Pakistan People’s Party, predecessor of the ruling PML-N, it would befit every party desirous of resolving longstanding national economic issues to lock heads and free up the common man in the bargain! 


*The writer is Community Editor


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