One year of Imran Khan

Pakistan Tehrik-i-Insaaf's first year in power ended not with the Prime Minister's address to the nation, as previously envisaged, so as not to divert attention away from the appalling conditions in Indian-Occupied Kashmir (IOK) but with a conference organised by the Special Assistant to the Prime Minister on Information and Broadcasting, Firdous Ashiq Awan. There is no doubt that the solidarity of the Pakistani public with IOK under Indian-administered lockdown is pervasive; however to argue that the PM's address on his party's one year achievements would somehow divert attention away from the Kashmiris' plight is inexplicable given that the Pakistani public, like in other countries, began to compare the Khan administration's performance with its predecessors'. The government, again like its predecessors, uses state resources to try to shape the narrative while the opposition challenges it vigorously. In this context, it is vital to acknowledge that in spite of the fact that the opposition appears fractured and weak (as its senior leadership in jail,) yet the fact remains that (i) the federal government has a small majority in parliament and that too cobbled together with many turncoats; and (ii) in Punjab the PML-N won more seats than the PTI, while in Sindh the Pakistan People's Party has an overwhelming majority. In other words, a large number of Pakistanis did not support the PTI and are interested in what it has achieved during its first year in power.
The question is which are the elements of the government's narrative that have found traction with the people of this country? First and foremost the accountability, whatever the cost, the narrative is supported by a large number of people with few convinced that past abuse/misuse of power for financial gain by the senior leadership of the opposition is without merit. However, with the passage of time concerns about failure to make charges stick in a court of law are surfacing with a more widespread discontent associated with the failure to-date of getting the large sums repatriated into the federal kitty - sums in billions of dollars as revealed by the Prime Minister, his federal and provincial cabinet members and numerous special assistants. These failures are highlighted by the Opposition in its defence.
Secondly, the claim that the Ehsaas programme (200 billion rupees for the Benazir Income Support Programme against 118 billion rupees in the year past and another 200 billion rupees for social sector development) would effectively deal with the vulnerable is perhaps an overstatement. Two elements need to be considered notably: (i) BISP allocation is a transfer payment to the vulnerable, and unlikely to fuel productivity, while higher social sector allocations, unlike infrastructure allocations, do not generate as high a growth rate or employment opportunities; and (ii) large-scale manufacturing has been declining in the country due to government's tight fiscal and monetary policies (as per IMF conditionalities) with the government projecting a lower growth of 2.4 percent in the current year. Small and medium enterprises have also begun to lay off workers as per a Business Recorder anecdotal survey due to the slowdown in growth and those unemployed would join the ranks of the vulnerable though they may not be eligible for the Ehsaas programme.
The market-based exchange rate mechanism has eroded the rupee value vis-a-vis other currencies with a consequent negative impact on imports (though exports have not witnessed a significant raise) which in turn has had positive implications for the current account deficit but disturbingly negative implications on customs revenue in the first month of the current year thereby compromising the government's capacity to generate the 5.5 trillion rupees this year. And the condition of using CNIC for all transactions by the small shopkeepers by October this year or else face punitive measures, being resisted with threat of strike action, remains pending as talks between the Federal Board of Revenue and the retailers/wholesalers remain inconclusive. It is unclear who will win this round given previous administrations tried to implement similar measures but were forced to back down after sustained resistance by the wholesalers/retailers.
Unemployment has been rising but when coupled with a high rate of inflation, (around 11 percent at present projected to rise to 13 percent by the end of this year) the popularity of any government, including the Khan administration's, is at risk. The PTI government's defensive narrative is that the previous administration's corruption is the reason behind heavier reliance on borrowing, with about rupees 7.6 trillion added to the public debt. Hammad Azhar with no economic credentials, clarified that this high increase in public debt is because the government borrowed an additional rupees 1.2 trillion to build cash buffer in last fiscal as now the country is in an IMF programme and is debarred from borrowing from the central bank - an admission that no economist would have presented.
To conclude, a better option would have been a cut in budgeted current expenditure (which has risen on all counts in spite of claims to the contrary), that would have required a lower revenue target for the year coupled with lower reliance on borrowing.