LAHORE: Incarcerated vice-chairman of the Pakistan Tehreek-i-Insaf (PTI) Shah Mahmood Qureshi says the country’s take-off will not be possible despite “Uraan Pakistan” – a transformation plan for the economy – unless the government brings the political temperature down and develop a consensus on the ‘Charter of Economy’.
Commenting on the economic situation in the country in a hand-written letter from Kot Lakhpat jail, delivered on Sunday, Mr Qureshi wonders that the plan intended to achieve 6.0 percent growth by 2028, $10 billion investment per annum and exports worth $60 billion in five years, when real estate sector of the country has witnessed a slump of 80pc, industrial sector 70pc and retail business declined by 60pc.
He also stated that the business community was seriously concerned over ‘de-industrialisation’ of Pakistan.
In its negotiations with the IMF, the PTI vice-chairman says, the government had committed to collect Rs13 trillion in taxes in the fiscal year 2025 – a target 40pc higher than what it was able to collect in 2024. “This seems unrealistic, when the government had acknowledged nominal growth in GDP,” he says and adds that to achieve this target, additional tax measures of Rs1.7 trillion are required.
He says the Tax Laws (Amendment) Bill 2024 is a reflection of the government’s nervousness as it was introduced within six months of announcing the budget for 2024-25. He warns that barring people from withdrawing cash from their own bank accounts above a certain limit and sharing tax payers’ confidential data with hired tax auditors would further shatter the business community’s confidence and encourage the flight of capital. “Fate of Tajir Dost Scheme needs no elaboration,” he observed.
Regarding the agriculture sector, Mr Qureshi say that below-normal rainfall in the rain-fed agricultural zones may lead to water stress and the wheat production target of 27.92 million tonnes for Rabi 2024-25 will become difficult to achieve.
At the same time, he says, there is no clarity on agriculture income tax. The farmers are willing to pay agricultural income tax, but have no idea how to go about it, because the revenue department has no clear instructions, he says. He says there is no coordination between provincial governments, nor an enforcement mechanism in place. “This confusion will add to the IMF’s anxiety,” he adds.
Mr Qureshi says the sugar mafia, it seems, has their way and the farmers will suffer yet again. “Early indications are that this year cotton production might be 30pc to 35pc below target,” he claims and adds if the government remains unable to provide quality seeds to the farmers, the country should be prepared to import cotton to meet the requirements of its textile industry.
The PTI vice-chairman says the government’s low inflation claims don’t impress people as prices of essential items remain beyond the reach of a majority of consumers.
He says the economic revival claims of the government are negated by a 0.92pc growth in the first quarter of the financial year.
Making his argument on the country’s economic position, Mr Qureshi stresses that the need for an agreement on a Charter of Economy can’t be denied.
He, however, asks whether the PML-N leadership has even developed a consensus on the broader economic goals with its coalition partners? “The PPP and the PML-N do not seem aligned on the economic plan of the government,” he says and stresses that the government needs to bring the political temperature down, resolve tensions with the opposition and develop a consensus on the Charter of Economy.
Published in Dawn, January 6th, 2025
