Amidst much post-Uri attack sabre-rattling by India a challenge to a war of who ends poverty first by the Indian Prime Minister Narendra Modi to his Pakistani counterpart would find a welcome chord with the common man of the two countries.
Modi at a public rally in Calicut city, Kerala, stated on 25th September in his speech post-Uri attack (18th September): "I want to tell Pakistani people; India is ready to fight you. If you have strength, come forward to fight against poverty. Let's see who wins? Who is able to defeat poverty and illiteracy first, Pakistan or India?" Nine days later on 4th October, Prime Minister Nawaz Sharif responded to this particular challenge during his speech in parliament: "if they (Indian leaders) want us to fight them to end poverty then they should realise that poverty cannot be eradicated by driving tanks on farmlands."
True, but one would have hoped that Nawaz Sharif had also accepted the Modi challenge to take the lead in ending poverty and come up with proactive measures to reduce poverty in this country. Unfortunately though Nawaz Sharif is a firm believer of the trickle-down theory, or in other words to make the rich richer through fiscal (rising tax revenue through indirect as opposed to direct taxes) and monetary measures (reducing rate of interest for businesses) arguing that the resultant wealth would eventually trickle down to the poor. At the same time Nawaz Sharif during his three stints in power has focused on building physical as opposed to social infrastructure (which directly targets poverty and illiteracy) - a focus that has not given as many dividends in terms of reduced poverty levels or increase in the total percentage employed (given the high population growth rate) as he had projected.
One can only advise Nawaz Sharif to heed the advice of US Senator Elizabeth Warren (D) "Here we are the richest country on Earth. We have so much going for us, and yet we have a federal government that works great for millionaires. It works great for billionaires. It works great for giant corporations, for anybody who can hire an army of lobbyists, an army of lawyers, give lots of campaign money... For the rest of America, it's just not working and it's time to take that government back and make it work for us... So, what trickle-down economics was all about was saying to the rich and powerful, the government will help you get richer and more powerful... So starting in 1980 when it was all about 'fire the cops,' it was called deregulation, cut taxes for those at the top, which means there was less to invest on education, on infrastructure, on basic research. So, what's happened from 1980 to 2012 ... the answer is 90 percent, everybody not the top ten percent, how much of the growth did they get? That GDP kept going up. How much of the income growth did they get? And the answer is zero! None. Not a bit."
Warren's tirade is reminiscent of the Sharif's economic mantra notably the reliance on trickle-down theory, deregulation, low taxes for the rich, no income tax on the rich farmers and opposing the constitutional amendment that would have made it possible to tax the rich farmers, and low interest rates. And of course an additional component of the Sharif mantra is nepotism in appointments leading to over 700 billion rupee losses in just three years in three state operated behemoths - PIA, PSM and Pakistan railways - requiring budgetary injections.
The inequality adjusted Human Development Index (HDI) for India was 0.425 while for Pakistan the comparable figure was much lower at 0.377. This justifies India's placement in the Medium Human Development Index countries while Pakistan is placed with low human development index countries by the UNDP. India scored 0.609 in the HDI index while Pakistan scored 0.538, life expectancy in India was 69.4 while in Pakistan it was lower at 66.6, and gross national income per capita was 5497 for India and 4866 for Pakistan.
However, a comparison between India and Pakistan on the poverty front is perhaps the only area where we can still compete with our belligerent neighbour. Multidimensional Poverty Index (OPHI and UNDP defined) is composed of ten indicators including years of schooling and child enrollment (education); child mortality and nutrition (health); and electricity, flooring, drinking water, sanitation, cooking fuel and assets (standard of living). Pakistan's MPI was determined at 45.6 percent while an additional 14.9 percent were estimated to live near the poverty level. The breadth of deprivation in Pakistan, the average of deprivation scores experienced by people in multidimensional poverty, was estimated at 52 percent.
In India MPI data revealed that even in states generally perceived as prosperous such as Haryana, Gujarat and Karnataka, more than 40 percent of the population was poor by the new composite measure, while Kerala was the only state in which the poor constituted less than 20 percent. The MPI measure revealed that 55 percent of India is poor, close to double India's much-criticized official poverty figure of 29 percent.
There is an urgent need for the government of Pakistan to focus on social sectors and though these constitute sectors like education and health that have largely been devolved yet the problem is that the Centre is increasingly relying on provincial surpluses, which is at the cost of provincial outlay on social sectors, to enable it to keep its deficit at sustainable levels. Be that as it may, in recent weeks a politically beleaguered Prime Minister has been announcing (unbudgeted) allocations for building hospitals and schools around the country in jalsas fuelling skepticism as to whether the Treasury can actually release the announced amount and, in the unlikely event that the amount is released, would he staff these institutions on merit or on the basis of political patronage.
To conclude, there is an urgent need for the provinces to focus on social sector development which are the main components of MPI but this would necessitate the federal finance ministry backing down with respect to compelling the provinces to generate huge provincial surpluses every year. Citing Benazir Income Support Programme (BISP) as reflective of the government's effort to alleviate poverty must be seen in perspective: Ministry of Planning, Development and Reforms has calculated 30 percent of Pakistanis living below the poverty line that would require 3.8 percent of Gross Domestic Product to fund social protection effectively. This implies an amount of 422,941 million rupees in 2015-16 (3.8 percent of GDP of 11,130,035 million rupees in 2015-16) while total for BISP was only 102,000 million rupees. A lot more needs to be done which would require a revisit of government (federal and provincial) expenditure priorities.
Comments
Comments are closed.