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Prioritising economy a must – The News International

by Arifa Rana

LAHORE: The new government must prioritise its actions. Should it check the prices or stop running on forex reserves? Controlling inflation is as important as stabilising the rupee. Boosting manufacturing and creating jobs is another necessity.

The economy is in a real mess and the issues at hand cannot be resolved overnight. There is no certainty about the tenure of this government that constitutionally ends on August 18, 2023, but chances of assembly dissolution are there in four to six months.
Priority should be given to improving the administration and establishing the writ of the government. The new ruling elite should not waste time on blaming the past mistakes of the previous regime but must move ahead with actions to improve things.
Measures that hurt the poor must be avoided. In fact, steps should be taken to reduce the prices of daily use essential items through administrative measures. The state can start with reducing duties on essential daily use items. The loss in revenues can be compensated by levying higher duties on both luxury and daily use items.
Television sets for instance are needed by all families as a source of information and entertainment. The government can reduce duty and taxes on TV sets up to 32 inches and increase government levies as the size of the screen increases.
Normal sized TV set is a necessity, but a 70-inch set is a luxury enjoyed by the rich. The import duty on cars below 1000cc should be maintained, but doubled on all luxury cars. People would not protest much if the prices of essential items came down and prices of luxury or non-essential items shot up.
The coalition government is weak as it comprises of 10-11 parties. All of them must be taken into confidence while formulating these policies.
Once all parties are on-board, the masses must be explained these policies by all the coalition partners instead of just the PM. This will indicate ownership of policies among coalition partners. The earlier coalition failed because the smaller coalition partners were completely left out on all policy matters.
Forex reserves also need immediate attention. Time is running out. We must pay back loans worth $5 billion a month. We need dollars.
Shahbaz Sharif and Zardari have clout in China and that must be used. Similarly, Shahbaz can cash on the goodwill of his elder brother in Saudi Arabia. The International Monetary Fund (IMF) should be engaged immediately after we get the relief. In case of failure to get relief from our friends, the government must seek IMF assistance.
There is a crisis-like situation on the power generation front. LNG and furnace oil must be arranged as soon as possible. At the same time, the government must pay full attention to curbing theft and inefficiencies in the power system. People will not accept an increase in power tariff. The PML-N has good rapport with trade and industry. It is evident from the rebound in the stock market. The industry would be looking towards the government to not only ease the cost of doing business but also to reduce the cost of doing business. The state must engage with them to arrive at a viable policy keeping in view our current financial situation.
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