29th September 2016, 11:45 AM
Qualitative reforms required
The World Economic Forumís (WEF) global competitiveness index places Pakistan at 122nd place out of 144 economies in the list. Although it is a jump of two spots from last year, it is hardly anything to write home about. India has made the biggest leap from 55th to 39th this year while all other South Asian economies including Bangladesh and Nepal rank better than Pakistan. The main reasons cited for our non-competitiveness are rampant corruption, a slow judicial system and tax rates.
This government had promised to root out corruption during its tenure. Three and a half years later, the eradication of corruption seems more elusive than ever. Accountability institutions like NAB and FIA cherry pick high profile cases that have the tendency to become media trials more than anything else. Institutional failures make bribes necessary for businessesí start up and their growth.
The judicial system is sluggish. The plethora of cases and the ease of getting stay orders by either party coupled with corruption within the judiciary make it difficult for cases to be decide on time. Apart from these structural shortcomings there is also the matter of an unfair system where the party with the most expensive legal representation and/or political connections has an edge.
Our taxation policies are shortsighted, mostly dependent on indirect taxation with a very narrow tax base. The FBR fails to bring people into the net, as the general perception amongst businesses is that the countryís leadership pays close to nothing so why should we? The result is abnormal increases in tax rates to make up revenue shortfalls that discourage new investments.
It is ironic that a business friendly government is unable to even achieve the position we held back in 2007 in this index. Without qualitative reforms in these three major sectors, it is unlikely that we will fare any better next year. The PML-N will make the same promises it made in 2013 with elections coming up. One hopes that they are not empty this time around as well.
Source: Pakistan Today