Ramifications of ‘bold economic ‘reforms’ of PTI Govt

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By Lal Khan
The Pakistan Tehreek-e-Insaf (PTI) government’s ‘first 100 days’ mantra is proving to be a charade. The Federal Information Minister’s assertion that, “The army is fully backing the PTI government… we have accomplished more in nine days than any previous government could in five years” reeks of condescension and swagger, bordering on insanity. Ending deficits through sale of state assets, the ten billion-tree plantation campaign, austerity gimmicks and promises of bringing back plundered wealth, are mere stunts.

The pretentious reluctance about getting the punishing International Monetary Fund (IMF) loans and the mockery of parliament’s approval is a farcical ploy. The burden of the loans and the economic onslaught on the masses hardly affects the lifestyles of the obscenely rich parliamentarians that enter the elite parliaments, spending billions, only to reap exorbitant profits from these political investments.

Behind the scenes, vicious schemes are being prepared to fulfill the harsh conditionalities of the imperialist institutions that were duplicitously delayed by the previous Sharif government. Now the PTI regime will beseech the IMF to salvage Pakistan’s terminally sick capitalist system.

PTI — which has the highest number of billionaires in parliament — has been a capitalist party from its inception. Now it’s frantically trying to appease the capitalist elite and other forces that brought it to power. To plug the huge deficits, its only way-out is to squeeze the blood and tears of the toiling classes even further. Its initial drastic measures included a 10 percent increase in toll tax, rise in ATMs withdrawal tax of 24 percent, NIC cards fees have soared to Rs 2,400, the price of a bag of fertilizer has increased by Rs 800. Privatisation of national assets — including health and education -is also being planned.

Yet another Finance Minister from a corporate multinational and an ECC comprising of neoliberal bourgeois economists has been appointed. However, the only thing the ECC can do is to devise more deceptive and convoluted manoeuvres to carry out the vicious cuts inevitable under our decaying capitalist system. The poisonous austerity programme will be sweetened with cheap rhetoric, making it easier for the society to swallow.

ISLAMABAD: Sep 06 – Prime Minister Imran Khan chairs meeting of Economic Advisory Council at PM Office. ONLINE PHOTO

These ‘bold’ economic ‘reforms’ approved by Imran Khan will soon cause a painful increase in the prices of electricity and gas. According to press reports, last week the government announced it would increase electricity prices by two rupees per unit for the lowest consumers of less than fifty units. This means that for the poorest, there will be an electricity price-hike of more than fifty percent. This is the first step in PTI’s ‘austerity plan’ to cut power consumption subsidies at all tiers of consumers.

On September 4, Imran Khan approved an increase in the price of natural gas by an average of 46 percent, as ‘determined by the Oil and Gas Regulatory Authority’ in June. According to the press report, “The regulator determined up to 186 percent increase in gas rates for the poorest categories of domestic and commercial consumers, while the prescribed rates for other categories — industrial, cement, CNG, power and commercial — have been jacked up by just 27 to 31 per cent.” Again the worst affected would be the most deprived sections of society.

When asked if the PM was convinced about the gas price increase when he had been talking about reducing the burden on the common people, the Ministry’s senior bureaucrat replied, “There is no other way out.” He is spot on. Pakistan’s capitalist economy is crumbling. We are stricken by a worsening debt burden along with deficits spiralling beyond control. With the rich and mighty elite enjoying immunity from the state and the system, there is no choice other than to attack the oppressed and the poor. Regimes governing this diseased capitalism can only strike on the livelihoods of the workers and the oppressed in periods of social inertia.

The problem facing subsequent regimes since the mid-1990’s has been the piling up of the so-called circular debt in the electricity and gas sectors as well as others. Few dare to venture into the sanctimonious and dangerous domain of the circular debt and reveal the staggering rates of profits that these multilateral corporations and national capitalist firms are plundering. The total amount of the financial transactions of profits transferred abroad by these corporate investors is a closely guarded secret by the state and political elite.

The bourgeois politicians and the state institutions might ferociously wrangle among themselves publically, but they never ever expose the deals and larceny of these imperialist and national bourgeois investors. One of the most infamous corruption cases has been the notorious Swiss bank account scandal, which involved $65 million dollars in kickbacks and transactions of perhaps the most sinister and corrupt politician of the land in the IPP deal. That money was not retrieved for over two decades. By now, he has managed to secretly stash it into some obscure offshore tax haven.

According to a 2015 estimate, the amount of money extracted by these IPP investors had exceeded more than five-fold of the total invested capital in these plants in 1995. Had this massive plunder been saved by the state ownership control of the power production and reinvestment of the surplus into new projects, the amount of electricity that would have been produced by 2015 would have been more than five times than what these IPP’s are producing. In the gas sectors there are similar private sector national and international producers and contractors from whom the SSGPL and SNGPL buy natural gas. The workers of these companies are denied permanent employment and are threatened with redundancies. Military expenditures, imperialist debt, interest repayments and foreign investors’ profits will remain untouchable in Naya Pakistan.

Only a workers revolutionary government shall expropriate these fleecing circular debts and the IPPs under democratic management and control of the workers, who actually build and produce electricity through their hard labour. Such an historic feat can only be accomplished with a revolutionary socioeconomic transformation of society and the economy, to create a system where production and distribution systems function not for the motive of profit but solely for fulfilling human needs.

(The writer is the editor of Asian Marxist Review and International Secretary of Pakistan Trade Union Defence Campaign. He can be reached at ptudc@hotmail.com)