Sindh budget
SINDH’S budget for the financial year 2023-24 is a good combination of populist policies aimed at pleasing voters ahead of the next elections and a large donor-funded reconstruction plan for flood-affected districts and communities across the province. A quick glance at the budget documents underlines that the PPP government, which has been in power in the province since 2008, has got its spending priorities right. For the last few years, it has been diverting a big chunk of its resources to improve public service delivery, especially in the neglected areas of health and education, and infrastructure development. It can, however, be argued that the benefits of this expenditure have yet to reach a larger portion of the people, particularly those living in interior Sindh. The growing development gaps in both urban and rural areas of the province, in spite of the ever-increasing public development spending, is often mentioned by the PPP’s critics to press the point. Therefore, it is advisable that the Murad Ali Shah government get an independent study done on the impact of its development expenditure on the people of Sindh during the last five years.
Coming back to the budget, the provincial government’s Rs2.24tr spending plan for the next fiscal year seeks to spike its development allocation by over 52pc from last year’s original estimates of Rs459.7bn to Rs700.1bn thanks to foreign multilateral loans of Rs266.69bn for flood reconstruction efforts. Nevertheless, many suspect that the government, already facing a resource shortfall of Rs37.79bn, may be forced to drastically slash its contribution of nearly Rs433bn to development, owing to the expected deficit in the ‘exaggerated’ estimates of federal transfers and provincial revenue collection amid an economic slowdown. For example, Sindh’s nontax revenue collection of just Rs175bn this year falls far short of its target of Rs400bn. With the PPP facing no viable political challenge in Sindh, it doesn’t need to inflate its budget targets.
Published in Dawn, June 13th, 2023
Tackling disaster
ACCORDING to the latest weather models, the approaching ‘extremely severe cyclonic storm’ Biparjoy is likely to make landfall between the Indian state of Gujarat and Sindh’s south-eastern districts by Thursday. Meanwhile, weather conditions influenced by the storm are likely to impact Karachi, as well as districts further inland in Sindh. The federal minister for climate change and environmental coordination has called for “caution and planning”, though our state of disaster preparedness certainly needs improvement if the weather-related deaths in KP over the weekend are anything to go by. Almost 30 people lost their lives, principally in the southern districts of KP, including Bannu and Lakki Marwat, as the area was battered by heavy rainfall and strong winds on Saturday. Though one should not be alarmist, the coming cyclone could bring similar havoc to Sindh’s high-density settlements unless the authorities have contingency plans in place to shield the region from the worst impacts of the storm.
Sindh’s chief minister has identified three coastal districts — Thatta, Sujawal and Badin — as the most vulnerable to Biparjoy. People from some coastal villages have reportedly been evacuated, while the Sindh government says residents of other vulnerable settlements will also be relocated to safer ground as powerful squalls and extremely heavy rainfall threaten the region. Meanwhile, heavy rainfall and 80km per hour winds are also expected in Karachi, Hyderabad and a few adjoining districts. As had been pointed out earlier in these columns, the presence of hoardings in Karachi presents a major public hazard during stormy weather, as the weatherman says the coming storm could cause damage to loose and vulnerable structures. Though the authorities had said these billboards would be removed by Monday evening, preventive measures should have been taken much earlier, especially when there is a court order in the field banning the installation of such signage on public property. Furthermore, there are also concerns about flooding as several roads in Karachi’s districts South and Central remain dug up, while construction for the Red Line is also underway. It is hoped the authorities concerned are prepared, should predicted heavy rainfall materialise so that these dug-up thoroughfares don’t turn into death traps during inclement weather. As Biparjoy approaches, all precautions must be taken to protect coastal communities in Sindh and Balochistan, from small settlements to the sprawling metropolis of Karachi.
Published in Dawn, June 13th, 2023
Looking east
THE PDM coalition may have failed to set a direction for the flailing economy in its rather unimaginative second budget, but trade and industry leaders have been quite clear about how they believe Pakistan can chart a way out of its present crisis.
They have been pointing out some common-sense measures that successive governments have failed to implement, which include steps like fixing the country’s justice system, improving education delivery, reforming the bureaucracy, enforcing contracts, rightsizing the bloated machinery of the state, and forcing it to divest from businesses that have become a burden on the public exchequer.
The right interventions in these areas, most experts agree, can help create more wealth for both the citizenry and the government. Unfortunately, as the past year has shown, the country’s managers have seemed clueless about where to begin despite finding themselves in the midst of a major crisis.
The chairman of one of the largest conglomerates in the country, in a recent interview to Dawn, pointed to India as a case study. New Delhi implemented tough reforms following its last IMF programme some three decades ago, and is now reaping the rewards for its labours. He also echoed what many have been urging for a while now — that the revitalisation of trade with India, along with other regional economies, is a prerequisite to Pakistan’s long-term economic stability.
Unfortunately, Pakistan seems to have shut itself off to importing both good ideas or cheap goods from its eastern neighbour. Urging the government to reconsider, many have reasoned that when other countries with historical rivalries do not refuse to engage economically with each other, why should Pakistan and India? It is difficult to disagree.
Indeed, if one were to thoroughly account for the costs and benefits of Islamabad’s decision to suspend trade with India, the bottom line would reflect a net loss for our people. Perhaps it is time for our foreign policy pundits and decision-makers to reconsider their stance and decouple trade from geopolitical disputes.
From food to pharmaceuticals, Pakistan can import much from India and at far cheaper rates than from anywhere else in the world. Yet, we refuse to do so. With inflation crushing our citizens, the question ‘why’ must be revisited.
The state can keep pursuing its principled differences with New Delhi even while the two countries trade. It did so, for most of the two countries’ history.
Meanwhile, goods that can be bought for cheaper than the options available in the market should be allowed in so that the inflationary pressure can be relieved. Trade and geopolitics should be treated as independent components of international policy. Politicking on the matter is selfish and does no service to our people. Both our state and our politicians need to agree on this.
Published in Dawn, June 13th, 2023