History of fiscal deficit by Dr PT

I’m sharing Dr Pervez Tahir Article here which is very informative on the history of fiscal deficit. It was published in Tribune

https://tribune.com.pk/story/2045092/short-history-fiscal-deficit/?amp=1

The picture of the consolidated Pakistan fiscal operations for the complete fiscal year 2018-19 released by the Finance Division on 27 August 2019 has sent shock waves throughout the economy. There was intense media competition to locate the key result, a fiscal deficit of 8.9 per cent of GDP, in our short but turbulent economic history. In this paper, Shahbaz Rana described the deficit at 8.9 per cent of GDP as the highest in the past eight years. To Dawn’s Khaleeq Kiani, it was “perhaps the highest in the country’s history”. In the Business Recorder, Ali Khizar first estimated the fiscal deficit at 9.1 per cent and called it “scary” and the highest-ever since 1978-79. He noted parenthetically that no record was available prior to that year. He had to downgrade to “not too scary” when the official number was released the next day, not knowing that the Finance Division also operates Bata style (what is a few bases points among friends anyway!). Khalid Mustafa and Mehtab Haider of The News stuck to the highest-ever in the last eight years, but the second highest in 43 years since 1975-76 when “[the deficit] had escalated to 10.3 per cent of the GDP”.

As the fiscal data of the pre-Bangladesh period has not been re-estimated with the use of proper methodology, it is well-nigh impossible to know the highest-ever deficit number. However, the statistical appendix of the Pakistan Economic Survey 1972-73 gives a surplus/deficit series from 1948-49 to 1972-73. According to this series, Pakistan’s first-ever deficit occurred in 1965-66, a war year, when the defence spending more than doubled in a single year. Again, the next deficit happened in the war year of 1971-72.

Post-Bangladesh, the State Bank’s Handbook of Statistics on Pakistan Economy 2015 provides a consistent set of information using the current definitions. It was first published in 2010 and has since been made a five-yearly publication. The starting year is 1975-76, showing the first-ever double-digit fiscal deficit pointed out by Mehtab Haider. It was 9 per cent in the following year and in 1978-79; the latter year falling in the Zia regime. Junejo’s last year, 1987-88 also hit 9 per cent. The first year of Nawaz-I (1990-91) was the last time the 9 per cent mark was touched and PTI’s 8.9 per cent score is the sixth largest.

Deficits per se are loathsome to the neoliberal way of thinking, but it makes sense to see them in a context. Mr Bhutto’s 10 per cent in 1975-76 was entirely due to development expenditure, i.e. investment which laid the foundations of growth in the Zia years. In 1976-77, development expenditure increased to 11 per cent of GDP while the fiscal deficit stood at 9 per cent. In other words, one per cent of the revenue surplus was also used for development. General Zia’s 9 per cent in 1978-79 was also fully utilised for development. Muhammad Khan Junejo’s 9 per cent was absorbed in a development expenditure of 7 per cent and a revenue deficit of 2 per cent. The development expenditure declined to 6 per cent and revenue deficit increased to 3 per cent under Nawaz-I. Out of PTI’s 8.9 per cent, only 3.2 per cent goes to development and as much as 5.7 per cent to cover the revenue shortfall. Just as a high fiscal deficit is not necessarily bad, a low fiscal deficit is not necessarily good. The lowest-ever fiscal deficit of 2 per cent was achieved in 2003-04 falling in General Musharraf’s period, but development expenditure was just 3 per cent then.

Published in The Express Tribune, August 30^th, 2019.

Gender Equality and Sustainable Development

Gender Equality and sustainable Development

"It is a crime against humanity that all women are confined within the four walls of their homes like prisoners. They should stand side by side with men as their companions and in all spheres of life" (Quaid-i-Azam, Muhammad Ali Jinnah).

Pakistan is a home of 208 million people. Almost half of the population consists of females. For healthy and progressive society neglecting this crucial half of the population is counterproductive. Women’s role is unacknowledged and presumed that both the genders are not treated equally. Notwithstanding, both the genders do have equal opportunities but there are several cultural, social, and domestic constraints which are abstaining females to participate in the society.

Equality in both sexes is essential to achieve sustainable development. In a sustainable society women and men enjoy the same level of opportunities. That the access to all kind of resources are equally distributed as well as participation in economic activity and decision making is equal.

Sustainable development goals call for just society for sustainable development. It emphasizes on prosperity and peace which is not possible until we achieve gender equality in all its dimensions; social, economic and environment.

Gender equality has several aspects; in house equality, work equality, resources equality etc. Preference for boys over girls is a common form of gender inequality exists in the developing nations such as India. Male-dominated societies have gender inequality that can manifest in the form of the parents wanting the newborn to be a boy rather than a girl. Unfortunately, sex-selective abortions have become common in countries such as China and South Korea, nonetheless, in Pakistan it is not a big problem.

Although education is vital for both boys and girls especially in Islamic perspective. However, due to resource constraints and lack of facilities people do not send their girls to schools. This is one of the reasons that despite having equal number of schools our girl’s enrollment ratio is below than boys. Albeit, primary enrollment general gap is decreasing, and ratio currently stands at 0.91.

Female labour force participation is 20 percent according to Labour Force Survey 2017-18 compare to male labour participation rate 68 percent. Lower female labour force participation has numerous reason such as restriction on physical mobility outside home. Several interconnected factors restrict women’s mobility outside the home, among them (i) social, cultural, and religious norms;(ii) safety and crime; and (iii)the quality of available transport services. Moreover, Isran and Isran (2012) concluded that female employment is also constrained due to the non-availability of self-employment opportunities or the existence of culture inhibitions in seeking lower status, and low waged employment outside the household. Therefore, civil society as well as NRSP and Akhuwat foundation are giving loans to women for businesses. Several incubation centers are working on the female entrepreneurship. Moreover, several female training institutes and universities were established to mitigate the social, cultural and religious norms.

Another unequal behavior which was presumed is the ownership of property. SDGs Goal 5, Target 5.A. asks all countries to undertake reforms to give equal rights to economic resources as well as ownership and control over land and other form of property. SDPI paper reported that 89 percent women have the right to own land according to the Islam/Sharia law. While 80 percent women also control land as well. Rest of the 20 percent do not control it because it is difficult to manage land due to customs and traditions, or/and they have lacked the competence, knowledge and skills to manage land. Paper reported that on surface it seemed that a significant majority of men were in favor of women’s land rights, nonetheless, it is not apparent from the societal values and civil society stories. A Meta-Analysis shows that land-inequality negatively affects economic growth, especially at low development levels. The association is lower in short run but higher in the long run due to credit constraints and institutional mechanisms.

The situation which was bad few decades ago has been continuously improving for women in Pakistan. For instance, All Pakistan Ulema Council recently issued fatwas denouncing "honour killings". Women are now joining different profession such as more recently, women are joining police force as high ranked officers, they are now fighter pilots, firefighters, sportswomen in almost all sports from boxing to cricket.

United Nations 2030 agenda which was adopted by Pakistan’s parliaments in 2016 has Goal 5 which elucidates several dimensions of gender issues. It says that we need to ensure legal framework exists and implemented that promoted non-discrimination based on sex. Every province has pass several acts to end discriminatory behavior based on sex, race and ethnicity. It strictly advocates against the physical, sexual and psychosocial violence against women and girls as well as forced and early marriages and female genital mutilation. Although the problem of physical, sexual and psychological abuse exists however by making several acts in the parliaments after 2016 especially and implementing the strict rules of law and we are controlling it as much as possible. Recent PDHS 2017-18 reports decline in violence against women that is a positive sign and it will be completely eradicated by stringent implementation of rule of law that protects women from all kinds of violence. Bolo helpline and Women’s safety app along with several acts and laws

Women has significant but unacknowledged presence at all levels of nation building. Target 5.4 suggests recognizing and value unpaid care and domestic work. In this way one can recognize women’s contribution in a more visible and rewarding way.

Target 5.5 realizes us that not just home rather women’s roles is as much important in higher-level decision-making process. Therefore, it emphasizes on the full and effective participation and equal opportunities for leadership at all levels of decision-making in political, economic and public life. In national assembly 18 percent are the female representatives who raises their voices expressively in all the standing committees. Moreover, female percentage is increasing at the managerial level positions at different corporate firms.

Health related issues are in general discussed in Goal 3 of Sustainable Development Goals. Nevertheless, Target 5.6 specifically, illustrates universal access to sexual and reproductive health and reproductive rights as agreed in accordance with the Programme of Action of the International Conference on Population and Development and the Beijing Platform for Action and the outcome documents of their review conferences. Pakistan has been progressing on it by making laws, giving awareness and changing habits of people towards it.

From the above discussion, it is unambiguous to say that empowerment is the first step to achieve gender equality. It starts with awareness raising to both men and women on numerous aspects including harassment, assaults, land distribution, financial inclusions etc. It creates and increases decision making power that consequently raises the standard of living as well overall economic, social development.