Profit GENERAL ELECTIONS TO BE HELD IN LAST WEEK OF JANUARY: ECP In partnership with
Rs 15.00 | Vol XIV No 83 I 8 Pages I Islamabad Edition
Friday, 22 September, 2023 I 5 Rabi ul Awwal, 1445
g COMMISSION ALSO WRITES LETTERS TO CS, ANNOUNCEMENT EXCEEDS NOV 6 CUT-OFF DATE SUGGESTED BY PRESIDENT ICT CHIEF COMMISSIONER REGARDING BY MORE THAN TWO MONTHS PREPARATORY ACTIVITIES FOR POLLS
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ISLAMABAD
STAFF REPORT
ALLING short of mentioning exact date, the Election Commission of Pakistan (ECP) on Thursday announced general elections in the country would be held in the last week of January 2024. The much-anticipated announcement, though lacks a specific date for the elections, exceeds the Nov 6 cut-off date suggested by President Arif Alvi by more than two months. In a statement, the election commission said that it reviewed work on delimiting constituencies and decided that the initial list for the delimitation of constituencies would be published on September 27. After hearing objections and suggestions regarding the exercise, the final list would be issued on November 30, the commission said. It said that polls would be held in the last week of January following the completion of a 54-day election campaign programme. Immediately after the development was announced, Pakistan’s dollar-denominated government bonds slipped by as much as 1 cent. Most of the sovereign bonds slid lower, but the 2031 maturity fell by the most with of drop of just over 1 cent. The country faces a funding crunch and is widely expected to need a longer-term support programme from the International Monetary Fund after the election. The announcement comes a day after the ECP said it had scheduled a meeting with political parties next month to discuss the code of conduct for general elections. According to the ECP, a draft code of conduct has been shared with political parties to get their feedback before finalising the rules of the game. The draft code says political parties, contesting candidates and election agents
shall not propagate any opinion, or act in any manner prejudicial to the ideology of Pakistan, or the sovereignty, integrity or security of Pakistan, or morality or public order, or the integrity or independence of the judiciary of Pakistan, or which defames or brings into ridicule any government institution including the judiciary and the armed forces. The ECP had ruled out elections this year, citing the need for fresh delimitation of constituencies following the notification of the latest 2023 digital census. Since the National Assembly was dissolved three days before the end of its constitutional term, Article 224 of the Constitution mandates that elections be held within 90 days of the dissolution of the assembly by November 7. But at the same time, Section 17(2) of the Elections Act states that “the commission shall delimit constituencies after every census is officially published.” During the last round of consultations with the ECP, political parties took different positions on the timing for elections with some highlighting the need for fresh delimitation and others — notably the PTI and PPP — calling for holding polls within the constitutional time frame.
ECP SEEKS DCS’ SUPPORT IN ELECTION PREPARATIONS: Meanwhile, the ECP has written a letter
to the chief secretaries of the four provinces and the chief commissioner of Islamabad, apprising them of the upcoming elections and the commencement of preparatory activities by the electoral watchdog in this regard. “Article 220 of the Constitution provides that all executive authorities in the Federation as well as in the provinces are bound to assist the ECP and the chief election commissioner in discharge of its function,” the letter sent to all chief secretaries by the ECP said. Article 220 of the Constitution reads: “It shall be the duty of all executive authorities in the federation and in the provinces to assist the commissioner and the Election Commission in the discharge of his or their functions.”
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PDM parties ‘welcome’ announcement; PTI to move top court
ISLAMABAD: As the uncertainty surrounding general elections ended with the Election Commission of Pakistan’s (ECP) announcement of a timeframe for the polls, major political parties in the former ruling alliance welcomed the development, hoping that it would remove the apprehensions regarding the political situation of the country. In a much-awaited move, the electoral authority has announced that elections will be held in January next year following the completion of the delimitation process. Polls were supposed to have taken place within 90 days, but the election watchdog said it needed more time to redraw constituencies following the latest population census. “The final list of constituencies will be published on November 30. After that, the elections will be held in the last week of January 2024, after a 54-day election programme,” the commission said in a statement. Reacting to the development, Pakistan Muslim League-Nawaz (PML-N), Pakistan Peoples Party (PPP) and Muttahida Qaumi Movement-Pakistan (MQM-P) viewed it as positive while Awami National Party (ANP) called for a specific date, however, Pakistan Tehreek-e-Insaf (PTI) decided to challenge the move in court. Following the announcement of the poll date, the Imran Khanled party has decided to challenge the Election Commission’s decision to conduct elections in the last week of January. PTI’s core committee member Niazullah Niazi said that the Constitution calls for elections within 90 days and exceeding the period is unlawful. STAFF REPORT
At meeting with PM, IMF chief urges Pakistan to tax the rich, protect the poor ISLAMABAD
STAFF REPORT
International Monetary Fund (IMF) Managing Director Kristalina Georgieva has urged Pakistan to “collect more taxes from the wealthy and protect the poor people” amidst soaring inflation following the nation’s securing of a last-minute bailout in July. Pakistan’s year-on-year inflation for the month of August leapt to 27.4pc, contracting household budgets. That same month, exorbitant electricity bills led to protests across the country. The rattled government had initially promised some relief for the public, but later ruled it out citing Pakistan’s commitments with the IMF. Speaking to Geo News after meeting caretaker Prime Minister Anwaarul Haq Kakar on the sidelines of the United Nations General Assembly on Wednesday, Georgieva said that she believed this was in line with what the people of Pakistan would like to see for the country. “What we are asking in our programme is that please collect more taxes from the wealthy and please protect the poor people of Pakistan,” she said. “I do believe this is in line with what people in Pakistan would like to see for the country.” Later in a post on X (formerly Twitter), the IMF chief said she had a good meeting with the Pakistani premier on the country’s economic prospects. “We agreed on the vital need for strong policies to ensure stability, foster sustainable and inclusive growth, prioritise revenue collection, and protection for the most vulnerable in Pakistan,” Georgieva added. Meanwhile, interim PM Kakar also posted on X about the meeting. He said he held a constructive dia-
logue with the Fund’s director that “emphasised extending our mutual commitment towards bolstering economic stability and growth in Pakistan”. An official handout released by the Prime Minister’s Office said that Kakar expressed gratitude for the IMF’s approval of the $3 billion standby agreement to support Pakistan’s economy. It said the premier briefed Georgieva on the various measures taken by the government to “stabilise and revive the country’s economy”. “The prime minister affirmed that these initiatives aim to create a stable and conducive environment for sustainable economic growth and investment. Additionally, a strong focus had been placed on protecting the vulnerable segments of society,” the PMO statement said. It further said that the IMF chief “appreciated Pak-
istan’s concerted efforts in implementing policies and reforms to revive the economy”. She assured that the IMF remained committed to continued engagement with Pakistan, the statement added. On July 12, the Fund’s executive board had approved a $3 billion bailout programme for Pakistan which will immediately disburse about $1.2 billion to help the country. On June 29, the IMF and Pakistan had reached a Standby Arrangement to ease the country’s financial crisis. The IMF in a press release had said that the executive board approval allowed for an immediate disbursement of $1.2bn, with the rest to be phased over the programme’s duration — subject to two quarterly reviews. IMF’s approval had come after Saudi Arabia and the United Arab Emirates (UAE) deposited $2 billion and $1 billion, respectively, with the State Bank of Pakistan, boosting the foreign exchange reserves. The $3bn funding, spread over nine months, is higher than expected for Pakistan. Earlier, the country was awaiting the release of the remaining $2.5bn from a $6.5bn bailout package agreed in 2019, which had expired in June. PM PROPOSES MEASURES FOR DEVELOPING ECONOMIES: Later, the prime minister addressed the Financing for Development Dialogue on the sidelines of the UNGA, where he proposed measures for developing struggling economies under the umbrella of the United Nations (UN). He stated that an investment entity could be formed to “create and enlarge the capacity of developing countries to identify proposed SDG (sustainable development goal) related bankable projects”.
BRI and CPEC vital vehicles for achieving SDGs: PM ISLAMABAD
STAFF REPORT
Caretaker Prime Minister Anwar-ul-Haq Kakar noted that China’s Belt and Road Initiative (BRI) and the China-Pakistan Economic Corridor (CPEC) are vital vehicles for achieving the Sustainable Development Goals (SDGs). Mr Kakar expressed these views during a call on with Chinese Vice-President Mr. Han Zheng here in New York on the sidelines of the UNGA Summit. The conversation was marked by traditional warmth and cordiality that has been the hallmark of PakistanChina All-Weather Strategic Cooperative Partnership. During the meeting, the two leaders exchanged views on the entire gamut of bilateral relationship including CPEC and bilateral economic and financial cooperation. Reiterating support to China on core issues, the Prime Minister appreciated China’s unflinching support to Pakistan’s territorial integrity, sovereignty and socio-economic development. He noted that China’s firm opposition to holding any G20 meeting in the disputed region of Jammu and Kashmir reflected China’s principled stance for upholding international law and UN resolutions. In his remarks, Vice-President Han said that PakistanChina friendship is unique and has withstood the vicissitude of time due to deep fraternal ties between the peoples of two nations. He added that as a close neighbour and iron-brother, Pakistan occupies a special position in China’s neighbourhood diplomacy and that China would continue its efforts for safeguarding Pakistan’s core interests and for the economic development and prosperity of the people of Pakistan. Expressing satisfaction at the steady development of CPEC projects in Pakistan, the two sides agreed on the centrality of CPEC for Pakistan’s socio-economic development and expressed their firm commitment to continue working together for realizing its shared objectives. The two leaders also expressed satisfaction at the celebratory events held in both countries to mark the 10th anniversary of CPEC.
Govt abandons plan of electricity bill payments up to 200 units g
DECISION INDICATES SHIFT IN PRIORITIES TOWARD FISCAL CONSIDERATIONS, REVENUE COLLECTION PROFIT
NEWS DESK
The government’s decision to abandon the proposal to extend the payment of electricity bills for consumers using up to 200 units over three months, despite a previous agreement with the International Monetary Fund (IMF), indicates a shift in priorities towards fiscal considerations and revenue collection from electricity bills. According to Caretaker Energy Minister Muhammad Ali, the impact of this decision was deemed nominal, as most of the bills had already been collected, and there are plans to gradually reduce electricity bills starting from October. The minister said that the government is actively pursuing various power projects, including a 660 MW solar project in Muzaffargarh, a 330 MW imported coal-based plant in Gwadar, and the C-5 nuclear power plant with a 1,200 MW installed capacity. These projects are being developed despite challenges related to the capacity payment trap in the energy sector. He said that the 660 MW solar project will proceed once a competitive price is obtained at a reasonable level. This suggests a commitment to renewable energy sources in Pakistan’s energy mix. Responding to a question, Muhammad Ali said that Pakistan is exploring the possibility of importing more crude oil from Russia. Establishing a specialpurpose vehicle (SPV) is being considered to ensure sustainable imports of Russian crude oil. This move could help diversify Pakistan’s sources of energy resources. The Energy Minister expressed concerns about gas availability during the upcoming winter season and emphasized the need for long-term agreements to secure sustainable supplies of ReGasified Liquefied Natural Gas (RLNG).
Inflation revised upward to 25pc as ADB downgrades growth to 1.9pc g
UPCOMING ELECTIONS, PERSISTENT POLITICAL INSTABILITY REMAIN KEY RISKS TO IMPLEMENTING REFORMS PROFIT
NEWS DESK
The Asian Development Bank (ADB) has revised Pakistan’s GDP growth forecast for the fiscal year 2024 down to 1.9 percent (two percent in April), while inflation is forecast at 25 percent, sharply higher than the earlier 15 percent projection, saying downside risks to the outlook remain exceptionally high. The bank in its report, “Asian Development Outlook,” stated that amid the upcoming election season, persistent political instability will remain a key risk to implementing reform toward growth stabilisation, the restoration of confidence, and sustainable debt. Disbursement from multilateral and bilateral partners would remain crucial for reserve accumulation, exchange rate stability,
and improved market sentiment. The bank also revised Pakistan’s GDP growth estimate for fiscal year 2023 down to 0.3 per cent (0.6 per cent forecast in April), because political instability and floods affected the economy. In Pakistan, inflation is estimated to have accelerated to 29.2 per cent in fiscal year 2023, faster than April’s 27.5 per cent forecast, the report added. In Pakistan, growth is forecast at 1.9 per cent in fiscal year 2024, assuming continued implementation of reforms and supportive macroeconomic policies, recovery from flood-induced supply shocks, and improving external conditions. Political stability following general elections later this year, if achieved, will boost business confidence, as will a new standby arrangement agreed with the International Monetary Fund (IMF) to support economic stabilisation and rebuild fiscal buffers.
The economy’s near-term prospects will heavily rely on progress under the economic adjustment program. The program aims to stabilise the economy and rebuild buffers for domestic and external balance, thereby providing a foundation for a possible successor programme under the new government expected to be elected in the first quarter of calendar year 2024, the bank added. The program involves fiscal consolidation, monetary tightening, and a return to a market-determined exchange rate, as well as structural reforms in energy, state-owned enterprises, banking, and climate resilience. The economy is projected to recover modestly in fiscal year 2024 with base effects from the post-flood recovery. Uncertainty will linger, though, and stabilisation measures will limit the growth of demand. It further stated that fiscal and monetary tightening will crimp demand, as will infla-
tion staying in double digits. On the other hand, implementation of the economic adjustment program and a likely smooth general election should boost confidence, while the easing of import controls should support investment as fiscal tightening restrains public consumption. On the output side, better weather conditions will enable an increase in the area under cultivation and in yields, supporting recovery in agriculture. In turn, the recovery of farm output will feed through to industry, which will also benefit from the increased availability of critical imported inputs. The recovery of output will enable exports to pick up, although imports will grow much faster, due to pent-up demand. However, the downside risks are significant, including from global price shocks and slower global growth. Downside risks to the outlook remain exceptionally high. On the
external front, tighter global financial conditions and potential supply chain disruptions from any escalation of the Russian invasion of Ukraine will weigh on the economy. The report noted that fiscal tightening will come from raising revenues and containing spending. The fiscal year 2024 budget targets a primary surplus of 0.4 per cent of GDP and an overall deficit of 7.5per cent of GDP, gradually declining over the medium term. Tax revenues are programmed to hit 10.3 per cent of GDP in fiscal year 2024. Provincial spending will be cut by 0.4 per cent of GDP and spending on defense and energy subsidies will be limited, while protecting priority social and development outlays. The government has committed to granting no further tax amnesties or issuing new tax preferences or exemptions.
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