Finance Minister Shaukat Tarin Gives Upbeat View on Pakistan’s Economy
By Elaine Pasquini
Washington, DC: On October 13, during his visit to Washington, DC to meet with International Monetary Fund and World Bank officials during their annual meetings, Pakistan’s Finance Minister Shaukat Tarin engaged in a rapid-fire conversation on a dozen hot-button topics with Peter Lavoy, former senior director for South Asia at the National Security Council. The United States Institute of Peace hosted the one-hour virtual program.
The most important part of his visit to Washington was meeting with IMF officials to discuss the proposed $6 billion loan package to Pakistan, the minister said. “I think the progress we made today is encouraging and, insha Allah, I see this happening now.”
Lavoy asked Tarin to explain Prime Minister Imran Khan’s plan to pivot from focusing on Pakistan’s role in the region and the world from geo-security to one of geo-economics.
“What the prime minister is saying is that we have to start looking through the prism of the economic welfare of our people,” Tarin said. “This change of focus means everything changes in terms of foreign policy, economic policy, internal security…and your relationship with your neighbors.”
“But, we have an issue,” he continued. “And the issue is India. This is one area we need to solve.” And Kashmir is the fundamental dilemma between India and Pakistan, Tarin said. While UN Security Council resolutions have stated that the territory is disputed, “somehow this government of India does not accept that.”
As finance minister, Tarin’s focus is on the economy and particularly on the poorer echelon of Pakistan society. “Pakistan today is not only growing, but we have also decided that we are not going to leave the underprivileged by the wayside,” Tarin said. “The underprivileged have been waiting for the trickledown effect for too long. Because our growth has been cyclically and has not been sustainable over a period of time, trickledown has never reached the bottom rung of our society. So, we are going after the bottom-up approach.”
“We have consolidated our economy and now we are going to grow,” he said. “We have 60 percent of our population under age 30. They need jobs. We have taken steps to revitalize agriculture, industry, exports, housing and we believe that this year we will grow by five percent.”
One improvement, said Tarin, who was a banker in the private sector for 35 years, is micro-finance banks and micro-finance NGOs who are trying to assist the poorer families in Pakistan. They will give small farmers interest-free loans and the same for small businesses, health insurance and technical training.
Having worked in banking for decades, Tarin is a big fan of privatization. “I am a firm believer that in developing countries government has no business doing business,” he stated. “We have to privatize more companies. This process has started and hopefully you will see major progress in the next three to five years.”
Attracting foreign investment is a big concern for Pakistan, but many international companies feel the bureaucracy can be overwhelming which is a concern to the minister. “We are working to remove issues and the ease of doing business is improving,” he said. “Last year Pakistan jumped around 28 places in ease of doing business.”
“Because of the issue of terrorism, some investors have been shy of investing in Pakistan, but now that we have security under control…you will see the number of companies coming to Pakistan increase,” Tarin predicted.
Lavoy, who lived in Pakistan many years ago, pointed out that Pakistan is the fifth most populous country in the world with some 225 million people. “If Pakistan is successful,” he enthused, “if poor people can escape poverty, they can contribute to the world’s future in a remarkable way.”
Regarding the emerging humanitarian and economic crisis in Afghanistan, Tarin said, “The Taliban is in control whether we like it or not.” But, presently, “let’s look after their basic needs of food…and if the world does not do that quickly you could see some major disaster,” he warned. “We are on the same side with the United States. Let’s join hands once again for the betterment of the region which will be for the betterment of the world.”
On the subject of China’s financial investment in building infrastructure in Pakistan, a project known as the China-Pakistan Economic Corridor (CPEC), Tarin said Pakistan was “thankful to China because they committed $30-$40 billion dollars when no other country was willing to do that.” He also pointed out, however, “Chinese electrical companies collaborated with the American company, General Electric, on power turbines” in Pakistan.
“Our strategy is very clear,” he continued. “We want to be friends with everyone. We’ve been in a strategic partnership with the United States for the past many decades, so our friendship with China is not going to affect our relationship with the United States.”
Taking offense to a question inferring that Pakistan has not done enough to fight terrorism, Tarin stated, “Pakistan is a country that has lost 80,000 people because of terrorism, lost $150 billion of its economy because of terrorism. The country has suffered for 40 years.”
Reflecting on his time working for the government after having a very successful career in the private sector, Tarin said his desire was to “do whatever I can to fix this country.” Without working for the government, he insisted, he would have been unable to do that.
When Prime Minister Imran Khan invited him to work for the government, his response was “absolutely,” he related, adding “no amount of hurdles will stop us from making Pakistan economically great again – one of the top countries in Asia first and then the world.”
“In our lifetime, if we can make Pakistan one of the top countries economically in Asia, that will be an achievement,” Tarin averred. “That is my motivation.”
(Elaine Pasquini is a freelance journalist. Her reports appear in the Washington Report on Middle East Affairs and Nuze.Ink.)
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