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Wednesday, August 17, 2022
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EditorialHow not to make economic decisions

How not to make economic decisions

If there is one thing the ruling PTI has been consistent about since the beginning of its tenure, it has to be its inability to make wise decisions on the economic front. As much as Prime Minister Imran Khan would like us to believe the economy is on the right direction, the truth is far from it. Inflation rate jumped to an all-time high of 9.2 percent in October, prices of all major petroleum products are over Rs100 for the first time in the country’s history and a current account deficit continuously in the red. The musical chairs in one of the most important ministries – the finance ministry – has been played in front of the public. The fourth finance minister appointed in April, Shaukat Tarin, has now been appointed as PM’s advisor on finance, following the end of his six-month tenure. As of now, there is no finance minister in a country that is witnessing a cash crunch – though momentarily saved by the Saudi lifeline – and a deteriorating economy.

As if the situation wasn’t bad enough, the lack of PTI’s understanding on matters of economy, has led it into a tougher position. It has been reported that the government was led to believe by some negotiators involved in the revival of the IMF programme that accepting a controversial amendment in the State Bank of Pakistan (SBP) bill will not require changing the constitution.

But the situation is now on the contrary. According to media reports, at least half a dozen clauses in the SBP Bill 2021 are in violation of the constitution. These include but are not limited to ‘the removal of the SBP Governor on misconduct, complete immunity from a criminal investigation by the anti-corruption watchdog, powers to the SBP to directly communicate with the parliament by bypassing the Finance Ministry and future amendments in the SBP Act.’ These clauses were included in March when the federal cabinet approved the bill but turns out the cabinet was never completely briefed about the clauses and were under the impression that the constitutional change would not be required. However, if the government now wishes to revive the programme and get the next loan tranche of $1 billion dollars, the bill will have to be passed as is.

It is unlikely for the parliament to approve the bill. But that shouldn’t be the PTI’s main concern. The entire saga does expose the cracks among its loyalists. Why else did the then finance minister intentionally keep the government in the dark, should be a question raised in Bani Gala.

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