A daunting task

LAHORE: Pakistan's economy is in motion, but it is unclear whether the planners have confidence in their plans. There is no doubt that Pakistan faces innumerable economic woes, and successive governments have tried to take corrective measures. However, these measures have not been sustained, and the Pakistani economy needs political consensus to ensure consistency of policy. This is a dilemma that is difficult to resolve in a highly fractured and divided nation.

Experts and policymakers float ideas for economic revival, but each idea, if implemented in earnest, would hurt a section of society that benefits from the current measures. For instance, privatization is a contentious issue, particularly for employees of entities that incur heavy losses. Any talk of privatization triggers protests from workers, and the government continues to pay their salaries and bear the operating expenses even if these entities remain closed.

Additionally, successive governments have inducted party workers into public sector companies without merit, so even most governments are reluctant to privatize public sector enterprises in order to protect their electorate.

To delay or postpone the privatization process, most governments come up with the idea of revamping public sector enterprises (PSEs) to make them more attractive to investors. However, each revamping process has resulted in increasing the liabilities of all PSEs, which in turn increases state liabilities. Additionally, each PSE inducts high-ranked bureaucrats who enjoy high salaries and perks that they would not be able to get in their original departments.

With this baggage, privatization remains an uphill task. The current privatization exercise being carried out by the caretaker government could be derailed if it is not completed during their tenure.

Pakistan spends billions on health and education, but the government agenda needs the dedicated efforts of doctors and teachers. Absentee or indifferent doctors at hospitals and clinics are responsible for many deaths caused by their negligence.

Absentee teachers are depriving children of the knowledge that is essential for prosperity in the 21st century. Economic planners cannot force doctors and teachers to perform their duties as per their mandate. Pakistan is an unhealthy nation because doctors focus on wealthy private patients (who are few) instead of the poor (who are numerous). Pakistan produces illiterate children after 7-8 years of schooling because qualified teachers do not impart knowledge.

All economic planners claim that Pakistan's revenue potential is at least double what the country currently collects. It is generally believed that a satisfactory law and order situation indicates that the state has control over its affairs.

However, what we fail to realize is that the government must also exert its writ over economic affairs. The rampant tax evasion in the country is indicative of the fact that successive governments have abdicated their right to collect fair revenues, which has paved the way for a sustained increase in inequality. Even the caretaker government has failed to exploit the country's revenue potential.