The Pakistani budget for the year 2011-2012 proposed by the government officially sums up the economic dilemma Pakistan has been facing for the past three years. Once ranked third in the race for fastest growing economy in Asia after China and India, now Pakistan is not anywhere near that number. On the other hand, regardless of its expanding economic development in the last decade, this time around Pakistan is one of the slowest growing economies in the South Asian countries; whereas countries like India, Bangladesh and SriLanka are moving ahead.
The economic survey of the year 2010-11 has shown Pakistan’s economy to grow by 2.4% this year; the number far less than many African economies too. The budget proposed around this time of the year is intended to push up the GDP ratio to about ten percent. Given the past record, however, even this seems too high a stake to claim. Moreover, the budget proposes to withdraw subsidies which are going to result in nothing more than price hikes for the already distressed people of Pakistan.
The history is a witness to the fact that the government never holds onto its own promises. This financial year, it promises Rs 72.583 billion of tax collection. Deciding matters but not implementing them is what our government is brilliant at. All we have to do is to wait and see what false promises the government has in store for us this year around.
One flaw in the budget, as per usual, is that it doesn’t touch on agriculture as a source of revenue. A major chunk of our economy depends on agriculture; If only the budget could include the farmers as income tax payers. It is but evident that the country is low on taxes, which results in a dismal resource situation. The constitution itself doesn’t allow income tax to be charged to the agriculture sector, but with the 18th amendment and the NFC award, the provincial governments can ensure some level of assertion to involve this part of the society which accounts for one-fifth of the national income, into paying taxes.
While announcing the budget, one thing overlooked by Dr. Hafeez Sheikh was that the citizens of the State must not be lied to. The budget hopes to bring down inflation by half, to nine percent. It is next to impossible to bring down inflation to such a level so rapidly. Therefore, the budget for this year doesn’t really paint a promising and rosy picture for Pakistan. It won’t downgrade the gap between the rich and poor, it won’t revive economic growth, would most certainly not lessen our reliance on foreign aid, and will not empower the poor of this land. – Zainab Tariq
