ISLAMABAD: After taking the economy out of the main crisis, the PML-N Government is now concentrating on the forthcoming elections by presenting a development-oriented budget for the next fiscal year. The Government has an eye on elections with a plan to secure a second tenure using its performance in the field of development creating more jobs for youth in a big way.
The development allocations, both for the Federal and provincial Governments, are more than two trillion rupees, an unprecedented allocation for development in any fiscal year in recent history. The Government had fixed the growth target at 6 per cent for the next fiscal year. The overall size of the economy is estimated to be more than 350 billion US dollar which is a big achievement for the present Government.
Most observers of the economic scene are of the opinion that the Government performed well in taking the economy out of the major crisis. It is no more a sinking economy. It is a developing economy with an eye to achieve 6 percent growth rate during the next fiscal year.
During the current fiscal year, the Kissan Package of the Government paid the dividends to the national economy taking it out of the crippling crisis with bumper crops improving the overall growth of the national economy. The Services Sector also played an important in achieving the development goals during the current fiscal year. Both the sectors offset the pressure on the national economy eliminating the negative impact to a great extent.
However, industrial sector and manufacturing and overall exports failed to achieve the targets and it increased the trade deficit. For the next fiscal year, the Government had fixed the target at 25 billion US dollar for exports and 50 billion dollar for imports. The increase in imports was due to big import of machinery for the industrial sector. There was a 40 per cent rise in importing machinery. It means that the industrial sector will perform well during the next fiscal year boosting exports.
The Finance Minister pledged that the current account deficit of the national budget will not be allowed to exceed inflation. Lavish Government spending, particularly the non-development expenditure is the major cause of inflation and price spiral. The rulers had developed a habit to lavish spending which causes inflation and an imbalance in the current account.
The Finance Minister said that the package for the textile sector or overall exports would continue during the next fiscal year. The Prime Minister had announced a hefty package of Rs 180 billion to boost exports or arrest the falling trend of exports. There were criticisms on the Government for the Rs 180 billion package for the textile industry saying it had become part of regular history that the PML-N Government always supported the Textile Industry. Off and on, Nawaz Sharif announced packages for the textile industries in all his previous tenures also. Political opponents considered the industrialists and traders as the political constituents of the PML-N, and particularly Mian Nawaz Sharif, for which regular packages are announced.
It is to be seen that the textile sector or particularly exports will perform well during the next fiscal year or not and the incentives will be used properly or using the package for making up their profits that suffered shortfall during the economic recession.
The Budget proposes ambitious development plans in many sectors, including power generation saying that 15000 MW will also be added after an end to the present load shedding or 10,000 MW joining the national grid at the time of election year. Besides power generation, the Government plans to improve power distribution and transmission strengthening the existing lines.
The Government prepared off the grid power generation and distribution system by establishing solar plants in remote areas like Balochistan, Gilgit and Baltistan and other areas away from the national grid system. Balochistan and other backward areas are expected to be the real beneficiaries of the Off the Grid scheme and power generation plants. In the first place, the Federal Government should establish solar power plants for all the hospitals and educational institutions or other Government controlled institutions to ensure round-the-clock power supply to those institutions.
Independent economists had proposed time and again that the Government should purchase electricity from nearby Iran meeting the electricity shortfalls, if any, in Balochistan.
Railways will get more than Rs 42 billion buying new engines, bogeys besides improving and strengthening the railway line from Peshawar to Karachi ignoring Balochistan in a big way. During the past four years, the Government concentrated on improving railway system in Punjab and also on the main line and it ignored Balochistan for all those years. The Government should strengthen the railway line, improve the rail service to the people of Balochistan and boost international trade with rest of the world using Quetta-Zahedan section.
Better rail travel facility is also right of the people of Balochistan and the Federal Government should provide better travel and cargo facilities through this cheapest mode of transportation available.
Presumably Gwadar is least important project for the present Government and it is paying no attention to develop and complete the Gwadar Port Project at the earliest. Besides shortage of water and other basic facilities, the Government showing no interest to connect Gwadar with the Central Asian countries so that Pakistan should be able to earn billions of dollars for facilitating transit trade between the landlocked Central Asian countries and rest of the world, including the countries of East Asia.
Overall, the Federal Budget did not communicate the real picture of voluntary Federation of Pakistan and most of the economic development projects are precisely for Punjab under the cover of sectoral allocation instead of regional allocation of resources. It means that the Government refuses to accept Pakistan as a voluntary federation and considers it as a right to use all the resources on Punjab and partly Sindh ignoring Balochistan and other backward regions of Sindh, Southern Punjab, KPK, Gilgit and Baltistan.
The gimmick of sectoral allocations should be done away at the earliest and prepare the budget on the basis of Federating Units allocating funds for development. Otherwise, the Federating Units should make serious move to withdraw the taxation powers of the highly centralized Government in the interest of national unity.