By Asad Cheema
ISLAMABAD: President Pakistan Economy Watch (PEW), Dr. Murtaza Mughal has said the first major decision of the government to save foreign exchange has turned out to be disappointing.
H said that a simple ban on some unnecessary imports will not improve the current precarious situation as it would reduce the monthly import bill by barely one to one and a half per cent.
Dr. Murtaza Mughal said that a five-day workweek and closing markets by sunset would have been better options as keeping the markets open till midnight by generating electricity from borrowed oil is shocking and a clear violation of national interests.
He said that the local manufacturers of the banned items should not be allowed to increase the price by taking advantage of the opportunity nor should the smuggling of these items be allowed.
The President PEW said that oil imports were 8.7 billion during the first ten months of the last fiscal but now it has almost doubled to 17 billion dollars making the balance of payments situation worrisome.
He said that it is difficult to save a country from bankruptcy unless unnecessary imports are completely banned and energy subsidies are abolished.
Dr. Mughal said that imposition of financial emergency, immediate increase in petrol price by Rs 30-50 per litre, reversing corporate sector exemptions of Rs 800 billion, and minimum tax of Rs100 billion on agricultural income are necessary.
He suggested a special emergency tax of Rs500,000 on heavy vehicles to generate additional income of Rs20 billion, power tariff for houses larger than 800 square yards should be doubled, land allotment should be banned, prompt sale of failed state-owned companies and reduction in the non-developmental budget will also improve the situation.
The President PEW said that useless departments should be closed down. At present, 42 divisions are functioning in the central government under various ministries, including National Harmony, National Code, and National Heritage divisions which have no function at all.
He noted that the term of the governor of the central bank expired on May 4, but despite the current turbulent situation, the government has not appointed a full-time governor in his place, which is stoking worries.
Dr. Murtaza Mughal said that the situation could not be improved without the elimination of energy subsidies for which the government was waiting for the signal of the powerful quarters which should be granted otherwise the government will have to resign which will sink the country deeper into the quagmire of instability.