Govt move aimed at depriving country of power to carry out fiscal policymaking: Malik

ISLAMABAD: Former interior minister and chairman Institute of Research and Reforms (IRR) Senator A Rehman Malik has expressed concern and claimed that if the Parliament passes the Finance (Supplementary) Bill, 2021 to fulfil the condition of the International Monetary Fund (IMF), Pakistan will partially lose the power to decide its fiscal policy.

“Pakistan is going to hand over its sovereignty and the future of its generations to the IMF by accepting its demands and that just for $1 billion, which Pakistan could generate from its resources. The proposed Act is as a new version of the East India Company and it will cripple Pakistan by snatching its powers to act as a sovereign state.

This law even prohibits criticising or questioning the governor State Bank of Pakistan (SBP) for his actions, which means an utter violation of the freedom of speech since per the proposed amendment, immunity has been granted to the sitting SBP management including Board of Directors, governor, deputy governors, a member of any board committee and monetary policy committee and the staff of the bank for any act or performance of any functions or any legislation administered by the bank,” he said in a statement on Saturday.

He said that even then the demands of the IMF will not stop as the IMF has an agenda of crippling Pakistan’s economy and driving Pakistan towards international demands.

He said that every Pakistani is bound to suffer because of this ‘mini-IMF-budget’; therefore, the parliament, the opposition and the government should come up with a solution to get rid of IMF with a collective doable debt retirement programme. The nation sees a “dangal” in the parliament instead of a decent approach to handle national issues requiring the indulgence of the Parliament, he added.

The Pakistan People’s Party (PPP) leader said that in the proposed amendments, objectives of the SBP have been specified for price maintenance and financial stability, while the government has justified this autonomy as a way to maintain price, there has yet been no mention of the inflation targets or price stability despite, revising the act.

But, in what capacity can the State Bank control inflation, he questioned. He highlighted that the government can pay salaries by printing currency, whereas, restricting printing currency or loans to our foreign debt-ridden country will come under heavy pressure and we will be forced to beg for more loans.

He said that the government will not be able to borrow from the SBP under any circumstances, which will badly affect the financial needs of the government and the national exchequer and this will create hardships for the government, pushing us to bankruptcy. He said that there will be no check or deterrence on wrongdoings or criminal mismanagement or any criminal negligence by the employees of the SBP, he added.

Rehman Malik said that the entire business community is showing serious objections and reservations on the proposed amendments as the SBP will now not finance any rural credit, industrial credit, export credit, loans guarantee, and housing credit which means that these sectors will get into trouble and mafias with cash will flourish at the cost of the common man and the small business community.

He said that the proposed amendments have posed a serious threat to the sovereignty of Pakistan as the independent State Bank will be omitted from the State domain and it will be the State under obligation to become the subordinate of the State Bank. He said that an independent SBP would be dictating all our institutional decisions and state secrets and operations in the national interest will be directly subject to security risk and the IMF.

Rehman Malik said that a glance at the draft Act shows that it is not drafted by us but rather dictated by the agents of the IMF and the draft bill was shared with the IMF before placing it before the Parliament for discussion and adoption. He concluded that our country cannot afford this level of immunity to such a critical institution as it will be detrimental to our economy, as well as, the sovereignty of our country.

Copyright Business Recorder, 2022