The electoral process in Pakistan, marred with fraudulence, has finally concluded with the election of the President of Pakistan on March 9, 2024, with Asif Ali Zardari capturing the highest office of the State for the second time. Although the top constitutional position has been filled, the protests over lack of transparency in electioneering, especially post-poll riggings, continue. The executive branch is still in the process of formation as deliberations over the selection of the federal cabinet ministers are ongoing—the process will be completed within the next few hours. Once the Senate of Pakistan elections, approaching fast, are held, the Parliament will fully function, comprising three important pillars of the State.
Throughout the electioneering process, the hapless citizens of Pakistan had hopes and expectations from the state institutions, which once again failed to fulfill their obligations. Pakistan has faced considerable challenges in recent years, notably unabated interference by an unelected institution in state affairs, judicial activism, the compromised role of the National Accountability Bureau, media sensationalism, and political and religious demonstrations. All these have not only eroded our democratic dispensation but have also weakened governance.
Pakistan has undoubtedly entered into a new phase, despite lingering doubts regarding the transparency of recent elections. Various aggrieved persons/parties have taken their concerns to appropriate forums in pursuit of justice, though with little hope of getting it. The fate of these grievances now lies in the hands of the higher judiciary to ensure expeditious disposal of complaints by Election Commission of Pakistan (ECP) and cases by the election tribunals. Analysts speculate on the promising chemistry between President-elect Asif Ali Zardari and Prime Minister Shehbaz Sharif, envisioning them as formidable allies in driving the nation towards a path of progress and prosperity.
It would indeed be interesting to how the duo, Asif Zardari and Shehbaz Sharif manage affairs concerning the nation and strategize to alleviate their financial woes. Asif Ali Zardari and his party possess the ability and potential to significantly engage the global community, steering our foreign relations and policies towards coherence and effectiveness.
In his previous term as premier, Shehbaz Sharif demonstrated adeptness in fostering relationships with both bilateral and multilateral partners. Known for his negotiation prowess, he successfully secured from the International Monetary Fund (IMF) a 9-month US$ 3 billion Standby Arrangement (SBA), ending shortly with the hope of getting a final disbursement of US$ 1.2 billion. He has already issued directions to the concerned officials to seek an extended fund facility (EFF) program from IMF. Through their collaborative efforts, Zardari and Sharif may steer Pakistan towards a trajectory of stability, prosperity, and enhanced international standing.
With the top leader of Pakistan Tehreek-e-Insaf (PTI) incarcerated, and his elected supporters present in the National Assembly as part of the Sunny Ittehad Council, addressing their grievances becomes imperative for the attainment of political equilibrium. Until the concerns of PTI are earnestly acknowledged and redressed by the government, any possibility for political stability remains elusive. Despite the legal entanglements faced by PTI’s leadership, ensuring a fair trial remains their inherent right, necessitating the government to guarantee equitable treatment across all judicial platforms. Upholding principles of justice and due process is paramount, with the judiciary bearing the onus of safeguarding these fundamental rights throughout the legal proceedings.
The second biggest and most important challenge is to put the country on an economic trajectory. We are in an IMF program and the final review of SBA is expected in April 2024. After receiving a letter from the PTI leadership, IMF has asked to settle election disputes amicably but refused to interfere directly in our internal issues. It has shown a positive approach by stating that its delegation would visit Pakistan after the federal cabinet starts functioning to undertake a final review for the release of the last tranche of SBA.
While this positive stance of the lender of last resort is indeed encouraging, the onus now lies on our leadership to implement effective measures aimed at restoring fiscal balance. It is imperative to devise strategies keeping in mind that approximately 100 countries are currently enrolled in IMF programs, necessitating strict adherence to its stipulations.
The overarching objective of global lenders revolves around positioning the country to meet its debt obligations, often entailing directives such as increasing electricity and petroleum prices or policy rates. Consequently, the government’s focus has predominantly shifted toward cost-cutting endeavors, aimed at generating savings rather than prioritizing developmental agendas. These stringent measures not only impede developmental initiatives but also pose obstacles in ensuring the provision of necessities to the general public such as health and education. As such, a delicate balance must be struck between adhering to IMF conditions and safeguarding the welfare of citizens, fostering a comprehensive approach towards sustainable economic growth.
Achieving sustainable growth necessitates a shift towards revenue-generating strategies by the government. The leadership of Pakistan must deliberate on whether continued reliance on the IMF for fiscal sustenance is a viable long-term approach or if it risks mirroring the fate of nations like Argentina and others, perpetually tethered to global lenders. Despite stringent adherence to IMF directives, many nations worldwide continue to grapple with meeting their balance of payment obligations.
Austerity measures and cost-cutting paradigms advocated by the IMF have proven largely ineffective in ensuring the provision of fundamental amenities to citizens. As such, Pakistan’s leadership must reassess its fiscal policies, exploring avenues for bolstering domestic revenue streams for self-reliance.
Depending solely on external financial assistance, while expedient in the short term, may engender long-term economic vulnerabilities and stifle the nation’s autonomy in policymaking. Embracing a holistic approach that prioritizes sustainable economic growth, driven by indigenous revenue sources, is imperative for promoting resilience and prosperity in the long run.
Our current revenue generation strategies diverge from available potentials, necessitating a shift towards a simplified taxation framework and initiatives aimed at financial inclusion. Adopting a corporate model of governance nationwide is necessary to enhance accountability and efficiency across all sectors. Moreover, prioritizing technological advancements can catalyze productivity and growth without compromising performance. By streamlining taxation processes and promoting financial inclusivity, we can unlock untapped economic potential and cultivate a conducive environment for sustainable development. Implementing robust governance structures and leveraging technological innovations will give rise to economic resilience and position Pakistan as a competitive player in the global market.
Pakistan should reassess its priorities and concentrate on fulfilling its core responsibilities, including revenue generation, defense, global trade, and foreign relations. The government’s role should shift away from business operations, with a renewed emphasis on privatizing non-performing commercial entities that burden the national exchequer. By divesting these entities, Pakistan can alleviate financial strain on the treasury and bolster revenue through increased taxation.
Additionally, improving foreign relations and creating a suitable environment for investment, are paramount. Strengthening ties with neighboring countries, particularly India, could unlock new opportunities for trade and collaboration. Simplifying business processes and reducing bureaucratic hurdles will attract foreign and local investment stimulating economic growth. Furthermore, lowering policy rates can incentivize borrowing and spur investment in key sectors, accelerating overall economic activity. Adopting these strategic reforms will enable Pakistan to harness its full economic potential and thus achieve sustained prosperity.
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Dr. Ikramul Haq, Advocate Supreme Court, specialises in constitutional, corporate, media and cyber laws, ML/CFT, IT, intellectual property, arbitration and international taxation. He holds LLD in tax laws with specialization in transfer pricing. He was full-time journalist from 1979 to 1984 with Viewpoint and Dawn. He served Civil Services of Pakistan from 1984 to 1996. He established Huzaima & Ikram in 1996 and is presently its chief partner as well as partner in Huzaima Ikram & Ijaz.
He studied journalism, English literature and law. He is Chief Editor of Taxation. He is country editor and correspondent of International Bureau of Fiscal Documentation (IBFD) and member of International Fiscal Association (IFA). He is Visiting Faculty at Lahore University of Management Sciences (LUMS) and member Advisory Board and Visiting Senior Fellow of Pakistan Institute of Development Economics (PIDE).
He has coauthored with Huzaima Bukhari many books that include Tax Reforms in Pakistan: Historic & Critical Review, Towards Flat, Low-rate, Broad and Predictable Taxes (revised & Expanded Edition, Pakistan: Enigma of Taxation, Towards Flat, Low-rate, Broad and Predictable Taxes (revised/enlarged edition of December 2020), Law & Practice of Income Tax, Law , Practice of Sales Tax, Law and Practice of Corporate Law, Law & Practice of Federal Excise, Law & Practice of Sales Tax on Services, Federal Tax Laws of Pakistan, Provincial Tax Laws, Practical Handbook of Income Tax, Tax Laws of Pakistan, Principles of Income Tax with Glossary and Master Tax Guide, Income Tax Digest 1886-2011 (with judicial analysis).
He is author of Commentary on Avoidance of Double Taxation Agreements, Pakistan: From Hash to Heroin, its sequel Pakistan: Drug-trap to Debt-trap and Practical Handbook of Income Tax. Two books of poetry are Phull Kikkaran De (Punjabi 2023) and Nai Ufaq (Urdu 1979 with Siraj Munir and Shahid Jamal). He regularly writes columns for many Pakistani newspapers and international journals and has contributed over 2500 articles on a variety of issues of public interest, printed in various journals, magazines and newspapers at home and abroad.
Twitter: DrIkramulHaq
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Abdul Rauf Shakoori, Advocate High Court, is a subject-matter expert on AML-CFT, Compliance, Cyber Crime and Risk Management. He has been providing AML-CFT advisory and training services to financial institutions (banks, DNFBPs, Investment companies, Money Service Businesses, insurance companies and securities), government institutions including law enforcement agencies located in North America (USA & CANADA), Middle East and Pakistan. His areas of expertise include legal, strategic planning, cross border transactions including but not limited to joint ventures (JVs), mergers & acquisitions (M&A), takeovers, privatizations, overseas expansions, USA Patriot Act, Banking Secrecy Act, Office of Foreign Assets Control (OFAC).
Over his career he has demonstrated excellent leadership, communication, analytical, and problem-solving skills and have also developed and delivered training courses in the areas of AML/CFT, Compliance, Fraud & Financial Crime Risk Management, Bank Secrecy, Cyber Crimes & Internet Threats against Banks, E–Channels Fraud Prevention, Security and Investigation of Financial Crimes. The courses have been delivered as practical workshops with case study driven scenarios and exams to insure knowledge transfer.
His notable publications are: Rauf’s Compilation of Corporate Laws of Pakistan, Rauf’s Company Law and Practice of Pakistan and Rauf’s Research on Labour Laws and Income Tax and others.
His articles include: Revenue collection: Contemporary targets vs. orthodox approach, It is time to say goodbye to our past, US double standards, Was Due Process Flouted While Convicting Nawaz Sharif?, FATF and unjustly grey listed Pakistan, Corruption is no excuse for Incompetence, Next step for Pakistan, Pakistan’s compliance with FATF mandates, a work in progress, Pakistan’s strategy to address FATF Mandates was Inadequate, Pakistan’s Evolving FATF Compliance, Transparency Curtails Corruption, Pakistan’s Long Road towards FATF Compliance, Pakistan’s Archaic Approach to Addressing FATF Mandates, FATF: Challenges for June deadline, Pakistan: Combating the illicit flow of money, Regulating Crypto: An uphill task for Pakistan. Pakistan’s economy – Chicanery of numbers. Pakistan: Reclaiming its space on FATF whitelist. Sacred Games: Kulbhushan Jadhav Case. National FATF secretariat and Financial Monitoring Unit. The FATF challenge. Pakistan: Crucial FATF hearing. Pakistan: Dissecting FATF Failure, Environmental crimes: An emerging challenge, Countering corrupt practices .
Twitter: Adbul Rauf Shakoori
The recent publication, coauthored with Huzaima Bukhari, is
Pakistan Tackling FATF: Challenges & Solutions
available at: https://www.amazon.com/dp/B08RXH8W46
