For someone who does not believe in coincidences the Media's blitzkrieg type aggressiveness towards State-Owned Enterprises (SOEs), and the demonising of their losses every time we bow down to the IMF would definitely appear conspiratorial.
Financial imperialism; their humble minions!
Some of us, also, entirely miss the significance of SOE losses being exactly equivalent to the Defence budget - so what? Pretty soon our annual debt servicing obligations will be, if they are not already, three times the size of SOE losses, and our development expenditure will be one third of SOE losses - so what?
It is a race between revenue and expenditure, not a competition amongst expenditures; and arguably the singular hurdle in winning that race is perhaps an inefficient, untrained, exploitable tax collector, probably requiring surgical-strike type tactics to bring about any kind of change or improvement therein.
Best of luck, Comrade Zaidi!
Miracles can happen!
And we need a bunch of them in London right about now.
But today is not about collecting taxes, which will in any case be one hell of a task in an economy pushed to the wall mostly on the basis of murky, if not diabolical, economic theory; today is about SOEs, and why they should not be thrown to the wolves.
As for cricket, the nation needs to pray earnestly.
My arguments on family silver appear in earlier write ups and will not be repeated here.
But why should the Government subsidise SOEs? Well, perhaps because it also subsidises the entire private sector.
I am, finally, willing to agree that it is not the business of the government to be in business - with one proviso: if everyone agrees that it is also not the business of the government to pamper business.
If they want free markets, so be it!
But would our private sector be profitable without Government subsidy?
When searching for an answer to that, let us give the benefit of doubt to the entire agricultural sector, because, after all, it is the foundation of over 75% of our nation's exports; so let's not talk about all the subsidies on loans, support prices, and fertilizer subsidies - all of which, by the way, are also the bread and butter of related industries, like fertilizer, which also got cheap gas.
Any idea how much subsidy is given to the textile sector, for their nothing-to-write-home-about export performance? After a grant of Rs 180 billion by the previous government, the incumbents are again negotiating a package for the sector; without subsidized loans, without subsidized taxation on exports and imports, without duty drawbacks on multiple taxes and other incentives, would the sector even be profitable? Take the power sector and remove the government guarantees, then ask how profitable the entire sector would be after that; why is government subsidizing these private power sector companies to earn superlative profits in dollar term, and that too tax-free?
To digress: apparently no Chinese company is ever paying taxes in Pakistan, under CPEC.
And we wonder why there is a shortfall in tax revenue.
If the rumours are true and there is a cartel, then it is quizzical why the government looks the other way and supports a sector that, in any case, is dependent upon the generosity of the public sector development budget.
Is it true that the Chinese can sell cheaper cement in Pakistan?
As far as the entire construction sector goes, without government subsidy in one form or the other, presumptive taxes for one, which domestic service provider can compete with foreigners?
If the government had not implemented the Caller Party Pays regime in Pakistan, it is debatable whether or not everyone would be wasting their disposable income on an unproductive activity like talking; telecom costs in Pakistan are one of the lowest in the world, and the sector still cribs all the time about draconian government policies - as they all go laughing to the bank.
Sure, some sectors appear to be taxed heavily, but are they really paying enough; or are they simply perpetually cribbing to deflect attention from their bank balances?
But seriously, wouldn't it be cool to have a license to print money?
Well, if you know someone at the Central Bank, they are the ones who dish out such licences.
On top of this most basic form of monopoly rent, banks don't have to pay higher taxes; are allowed a much larger spread compared to the global norm; are provided emergency money by the Central Bank, in case they make bad decisions; have free hand over the nation's biggest asset, its savings; and somehow still crib about government policies - yet again, laughing as they count their money at the bank.
The entire automobile sector depends on government policies of cheap fuel, roads built on development budgets, heavy duties on imported vehicles, leniency in deletion programs, and mortgage financing, and they still are not happy.
The above list is not exhaustive; why does everyone have an association, and why does everyone have a Government Relations person ferociously pursuing the government for one benefit or the other, while all the time arguing for free markets?
Lobbies are perhaps the biggest threat to our economy.
Everyone is naked in the bath, so why single out SOEs?
For my money, critical sectors need to be fully owned by the Public sector and government should have significant influence in significant sectors.
A few years ago, in a series of articles published in the Business Recorder, it was concluded that the strategy for national assets was not OLX, but Machiavellian management policies as practised in the private sector.
The solution for Pakistan's industrial decline is more State - not less State!
(The writer is a chartered accountant based in Islamabad. Email: syed.bakhtiyarkazmi@gmail.com)