ISLAMABAD: Prime Minister Imran Khan has described expensive energy as the “biggest” problem in Pakistan as the cost of energy is 25 percent more than in competitors India and Bangladesh “that has impeded industrialisation owing to the power agreements signed in the past.”
Speaking at the “Country Strategy Dialogue on Pakistan” organised by the World Economic Forum (WEF) through a video link, the prime minister added that the biggest problem for the country was how to provide affordable energy to the industry.
The prime minister said the government wanted to bring down the cost of vegetables, and stated that Dr Hafeez Sheikh who was heading the weekly price monitoring committee was aware of the efforts being made by the government in that regard.
The premier said he would be “more than pleased if the forum could suggest something to the adviser on finance how to ensure farmers get paid more and consumers get a lower as well as to with respect to grade the products, so that these could be exported.”
The prime minister said the government’s role is of a facilitator to the private sector, “and we believe that the government’s job is not to come into business except certain crucial areas, so the public-private partnership is important.”
Agriculture sector is very important, he said and added that retails sales in Pakistan are of almost $125 to $130 billion, and the government would like to seek suggestions from the forum on how retail sector could purchase directly from farmers.
The prime minister said the government had encouraged automobile industry so that it could export from Pakistan.
“There has been growth in the sales of motor cars in Pakistan and the government is encouraging electric motored vehicles,” he added.
The prime minister said that Pakistan was a model for the developing world in the 1960s but unfortunately in the 1970s, the country went other way that choked industrial development.
“This is the first government after the 1960s that wants the industry to make profit,” he said.
In the construction sector where 30 industries are attached to, it has taken a year for the government to remove the bottlenecks, he added.
“The current Pakistan of 2020 is all about creating wealth through industrialisation and using that wealth to lift the people out of poverty,” he said.
The prime minister said that “Pakistan has stabilised its economy and was heading in the right direction before the Covid hit us, and just like every country, was badly hit by the Covid, and that every country was shut, and consequences of shutdown, the world is now facing.”
He said that for Pakistan it was not just a question of containing the spread of the virus but also insulating people from hunger.
He said that if the economy is locked down the labourers working in informal sector which are over 70 percent in Pakistan would be affected the most.
“We quickly realizes not to impose lockdown but go for a smart lockdown, and open up the economy quickly than others, and never locked down agriculture sector, and a cash programme was given to 15 million people,” he added.
The prime minister said people largely complied with measures and economy was saved.
“Now of course we are hitting the second peak and my worry right now is that the people are no logger that worried about the virus, and so the government does not find that sort of compliance as well,” he pointed out.
The prime minister said the government does not know how long this second wave will remain, and the lesson the government learnt from the first wave of Covid was that with this level of poverty, the economy could not shut down. So the government had taken a policy decision that the businesses and factories will not be locked down, and only non-essential will be locked down.
He said after the his government came to power, it faced twin challenges- fiscal deficit and the current account deficit- which were managed through cutting expenditure and reducing imports, adding that foreign direct investment was improving. He also talked of a clampdown on money laundering, which is a big problem in the developing world.
“As a result, after 17 years, last quarter we have current account surplus and currency is stabilising and exports started increasing after exporters were given incentives. The construction industry is moving and the textile industry is running with full capacity. The CPEC is not exclusive to China and any one could join it as after the first phase of connectivity, now the second phase is more than connectivity it is about agriculture and technology. “We are modernizing Railways, and ML-I connects Karachi right up to Peshawar, and in the next phase, we want to connect right through from Afghanistan to Uzbekistan, so it would connect Pakistan to China.
Unfortunately, we have right now problems with India, and we hope that this would change with the new government.”
The prime minister said it is after a long time that there is a prospect for peace in Afghanistan “and finally peace talks have started and Pakistan played a huge part in getting US and Taliban to sit on a table. Then it [Pakistan] played another very difficult role to get intra-Afghan dialogue get going.” He said unfortunately, growing violence in Afghanistan is a concern for Pakistan as peace in Afghanistan can connect Pakistan right to Central Asia, and tribal belt would benefit most from trade and connectivity. US President Donald Trump’s great achievement was resumption of peace process in Afghanistan, the prime minister said, adding he is convinced that President-elect Biden would not reverse it because there is no other solution.
Copyright Business Recorder, 2020
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