Where are we heading?

On October 12, 1999, through a military coup a democratically elected government was overthrown in the name of saving the country. The chief executive has been repeatedly justifying this action on the ground that the role given to the armed forces by the government of Pakistan includes defence against both internal and external threats. Therefore, as and when the armed forces may feel that there is an internal threat to the country, they may overthrow the government to save the country.

Anyways, what has been done can't be undone so there is no point in digging the past. But, the future can't be ignored because it belongs to 135 million people of Pakistan. It belongs to our children and future generations. One can digest bitter pills of martial laws if they deliver any good but our experience has so far shown that martial laws have been no exception to our journey of national degeneration.

Eight months have passed under the seven-point agenda for national revival of the present government. Some may argue that it is not enough period to set the things right, but it sure is enough time to judge the direction of the policies and their impact on the economy, society, and politics of the country.

The democratic governments are accused of making more propaganda and doing less. For the last eight months, the present government is also trying to convince the nation through the state media that a miracle is being manufactured for the nation under a very competent and dynamic team of the chief executive. Therefore, it is necessary to examine the impact of government policies to understand the final outcome. I am reminded of an advertisement campaign that was launched by two leading fast food chains in the US about their burgers. One company won the burger war by running an advertisement that challenged the claim of its rivals on the size of their burger by putting a simple question, "But, where is the beef?" It's time to ask the present government also, "where is the beef?" Are the country and people better off than they were eight months ago? This is the central question that must be asked and answered. I will analyse the performance of the government in the following sectors--economic, diplomatic, social, and political. As far as the economy is concerned, the latest State Bank report has clearly highlighted that investor confidence has been significantly shattered in recent months. Despite reduction in interest rates, private sector credit has shrunk. The exports have failed to reach the $9bn mark claimed by the chief executive. Tax revenues have shown a significant drop.

The large-scale manufacturing sector growth, that had maintained a 6-7 per cent growth rate since February '99, has dropped to zero per cent in March 2000. The stock market has crashed and the flight of capital from the country after the much publicised accountability drive has dried the economy. According to the Economic Survey released by the government, the economy failed to achieve the target growth rate of 5 per cent. Instead of admitting failure, the government has relied on jugglery of figures by comparing current year's figures with previous year's figures, which is like comparing apples with oranges. The previous year was the year of nuclear sanctions; hence all indicators were abnormally low. If there is any criteria against which the performance should be measured, it is the targets for the current year.

The only positive sign is the agriculture sector, which has done consistently well not just for wheat but, for the last three consecutive crops, also a bumper rice and cotton harvest. The robust growth in the agriculture sector is firstly due to Nature's kindness and, secondly, the self-reliance strategy that was initiated by the Muslim League government after the imposition of nuclear sanctions. The agriculture credit was doubled for small farmers and duties on tractors and agricultural implements were abolished that led to robust growth in the agro-industry as supply of tractors and modern machinery increased manifold in the last two years.

For last couple of years some hidden hands had been discrediting the political governments by holding them responsible for the loss of Rs230-250bn in sunk and non-performing loans. On this count the religious parties also jumped onto the bandwagon and started demanding accountability and recovery of this amount. This also formed an important component of the charge-sheet framed to dislodge the democratic government. But, the other day the chief executive, through the finance minister, very casually informed the nation during his press conference that this amount was only Rs100bn. If it is so then it comes to about 3.25 per cent of GDP, whereas this figure ranges from 8-30 per cent in many Asian countries. Then what is the justification for the corruption fever that was unleashed against the political governments?

Even if NAB were to fully recover this amount, it will come to about $2bn, whereas our foreign debt is about $38bn. But in the process of recovering $2bn, the government seems to be bent upon wrecking whatever is left of our economy, investor confidence, and industry. Accountability is a very noble cause but it has to be done in a manner that does not jeopardise the economy.

Strengthening of institutional capacity within the departments for monitoring of results is needed but no concrete steps are being taken in this regard. In September '97, the then prime minister had called a meeting of parliamentarians in the PM House, in which he made a commitment to carry out accountability and asked the MNAs to give the names of corrupt officials. I opposed the prime minister's accountability idea by first explaining my position as son of a former MNA, who was among six parliamentarians who refused lucrative residential plots in Islamabad during the Junejo government so that I am not misunderstood to be favouring the corrupt. I told the prime minister that the nation did not vote him in for accountability because if accountability were the nation's priority then Imran Khan or Qazi Hussain would have become prime minister in his place. The nation wants economic revival and turnaround. Unfortunately, blind accountability would be counterproductive as far as revival of the economy is concerned. We can either have a clean past or build a promising future, we can't have both.

Firstly, in an economy that has a cushion of over 50-60 per cent black money, an accountability drive would immediately cause massive flight of capital. Our position would be like having a Mercedes parked in the porch, but no money to buy petrol. All good intentions and policies would come to halt for lack of capital and investment. Secondly, the administrative system would be paralysed as no officer would take any decision on files and the "play-it-safe" approach would become the norm. Finally, no bank(er) would sanction project loans and the portfolio of banks would shift towards short-term working capital accounts of reputed groups, causing credit squeeze in small and medium sectors of the economy and the liquidity of these banks would touch skies.

I argued in the meeting that the prime minister should ignore all political agendas and should work exclusively for next six months towards restoring confidence of the business and investor community in our economy. Unfortunately, I was overruled by some colleagues but the coming months proved me right. The mistake that was not avoided by our government has been repeated in a far worse form by the present government.

We continue to live in a political mindset that romanticises slogans for vested interests. Corruption has no doubt been a major curse for our country but the manner in which it has been romanticised needs to be understood. The religious parties and some vested interests have used it as a tool for maligning the mainstream politicians, and unfortunately the mainstream parties themselves became victim of this slogan by throwing mud on each other. Have our leaders done more corruption than Marcos and Suharto? Still, the Philippines and Indonesia are not found to be conducting NAB-style accountability because they are economic nations. Accountability in today's global economy can't be carried out with Stone Age laws and procedures. If our own governments goes around telling the world that our politicians, bankers, bureaucrats, and judges all are corrupt, who would be out of his mind to come and invest in our country?