Prime Minister Muhammad Shehbaz Sharif has announced that the nation will soon receive good news about a reduction in electricity prices.
He stated that a decision must be made today on whether we will continue to live off handouts and rely on begging bowls.
He also mentioned that he will address the nation soon to present a five-year economic plan. These remarks were made during his speech at the Independence Day celebrations.
In his Independence Day address, Prime Minister Shehbaz Sharif linked the sovereignty of the nation to economic stability, mentioning the need to set government priorities to achieve national development and economic goals. If the current government aims for self-reliance, it must consider all the factors that have prevented us from reaching this goal in the past.
Self-reliance requires economic stability, which in turn depends on the continuity of economic policies. In the ongoing political opposition and personal interests battles, we have yet to establish a framework to reduce dependency on loans and move towards self-reliance.
Another essential component of self-reliance is lifting people out of poverty and ensuring they are economically self-sufficient, but the situation appears to be worsening.
The new fiscal year’s budget, with its super tax, new tax amendments, and levies on petroleum products, will increase the economic burden on the public.
The difficult decisions made by the government so far have primarily impacted the public, resulting in a growing number of people living below the poverty line and rising unemployment rates.
The new tax amendments imposed under IMF conditions will further limit purchasing power. While the reduction in electricity prices is welcome news, the government must also take immediate and effective measures to boost industrial development, given that gas prices have increased nearly fourfold and electricity prices about threefold, which will undoubtedly impact industrial growth.
It is also a fact that the cost of production in Pakistan is significantly higher compared to India, Sri Lanka, and other regional countries. Despite extensive criticism and revelations about IPPs (Independent Power Producers), the results have been disappointing.
Such corruption should be met with hefty fines and severe penalties, and the law must be enforced strictly. Industrial growth last year was only 1.2%, while this year’s budget targets 3.4%, which, although not impossible, will be challenging.
All external loans should not be used to increase non-developmental expenditures; instead, they should be used to establish new industries, enhance domestic production, and increase exports to earn valuable foreign exchange.
Countries that have obtained loans have used them to set up new industries and increase production, thereby boosting their gross national product. Bangladesh, Vietnam, and major Southeast Asian countries are prime examples of industrial development.
The government has once again failed to bring retailers into the tax net and needs to expand the tax net to include the industrial and agricultural sectors.
An analysis of the 2024 budget reveals that the middle class bears the highest tax burden.
Economists believe that there is significant potential for investment in the IT sector, but cooperation between IT universities and the IT industry is essential to provide students with modern IT education.
The IT industry’s needs must be met, and it must play a crucial role in the national economy. In the near future, like India, we should also be able to export IT-related products.
On the other hand, the government must expand its tax net. Why do we appear to be shirking our crucial national responsibilities? To address economic difficulties, the government has decided to outsource the management of the country’s major airports, starting with Islamabad Airport. There is also talk of privatizing several government entities, including PIA (Pakistan International Airlines).
The increasing losses of PIA, Railways, and Steel Mills have further pushed the national economy towards disaster. According to economists, the government must take urgent and effective steps to promote foreign investment to encourage it in the country.
Domestic investment-friendly policies must also be adopted. The real estate sector needs to be immediately included in the tax net, and its issues must be addressed on a priority basis, as it is linked with other important sectors like construction, which increases employment opportunities.
The population is growing at a rate of 2.5%, while industrial growth is at 1.2%. Despite better performance in the agricultural sector last year, its benefits did not reach the general public, and rising prices of vegetables, fruits, and meat have caused severe distress.
Farmers also need protection to address agricultural sector issues on a priority basis.
Affordable loans, tractors, and reasonable prices for fertilizers and inputs are essential. Countries that have invested extensively in science and technology have achieved rapid and sustainable economic growth.
It is crucial to establish industries producing international-standard products in high-tech fields and to export them on a large scale. This will provide appropriate job opportunities for the growing workforce and help eliminate poverty.
In this era of knowledge economies, we must focus on strengthening existing educational institutions, establishing new ones in emerging technologies, training professionals according to market needs, ensuring effective cooperation between educational institutions, research centers, and industries, encouraging private sector investment in high-tech industries, and providing incentives for the establishment of technology parks.
Pakistan’s software industry has enormous growth potential. Since software development primarily depends on human resources, suitable measures are needed to increase the number and quality of professionals in this field. Efforts must be made in IT education, e-Governance, and workforce development in IT.
The chemical industry is also critical for industrial development. Many chemical industries in Pakistan are still in the early stages, and pharmaceutical industries are currently importing 90% of active ingredients.
Pakistan needs to develop the capability to produce essential ingredients, especially those for which raw materials are available domestically.
Energy is key to the development of all sectors; without it, Pakistan will remain in decline despite its vast potential. It is essential to enhance people’s purchasing power in the face of rising inflation and create new job opportunities.
Addressing economic self-reliance and resolving public issues simultaneously is a pressing need. New projects should be pursued alongside ongoing ones, and the agricultural sector and its related industries should be promoted.
Considering the global food security challenge, if Pakistan aims to become a food basket, our export volume could significantly increase. While Pakistan’s textile industry is renowned worldwide, we have not achieved significant improvements in this sector.
Policy instability needs to be addressed, and a permanent think tank is required to make decisions based on pure administrative grounds, beyond political conditions.
Policy continuity cannot be achieved overnight; thus, urgent issues must not be ignored. The government needs to take strict measures to control inflation and make life easier for the public.
Governments have always talked about economic self-reliance; now is the time to define a clear economic direction and practically start moving towards it.