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Dawn Editorial 27 May 2020

Sugar probe

THE government of Prime Minister Imran Khan is being commended for sharing with the public the findings of the FIA-led inquiry commission set up last month to conduct a forensic analysis of nine sugar companies to determine the reasons for an abrupt and steep surge in the domestic price of sugar during the winter. Even the alleged involvement of some key politicians — or their close relatives — linked to the PTI government and its allies at the centre and in Punjab did not deter Mr Khan from ordering a more thorough probe and making its conclusions public. Some would argue that the factional differences within the PTI might have led the government to release the report. The recent statements by Jahangir Khan Tareen — who bankrolled the PTI’s election campaign in 2018 and was a close adviser of Mr Khan — that he was being victimised by the bureaucracy have lent some support to this argument. But that does not detract from the report’s findings or the government’s bold act of making it public.
The investigation was ordered by the prime minister to expand on the report of an earlier inquiry into the matter with the promise of stringent action against those involved in what is one of most publicised scams in recent years. The commission has done a good job in documenting the way the sugar business is conducted in Pakistan at a huge cost to the national exchequer, taxpayers and unsuspecting consumers. It also highlights the way politically powerful sugar barons use their clout to manipulate the market and government policies to steal from poor sugarcane growers, cheat the taxman, and secure large subsidies and export rebates — all in the name of consumers. The government, for instance, has been paying mill owners a subsidy of Rs29bn against a personal income tax of Rs9bn paid by them to ensure their factories keep crushing cane and producing sugar every year. In order to cheat the government and evade taxes, they conduct their transactions on paper slips, cartelise to inflate the cost of production, maintain two sets of accounting records, over-invoice exports and under-report their output. Sadly, all regulatory institutions from cane commissioners to the FBR to SECP to the district administration collude with the sugar mafia in its illegal enterprise to let them make windfall profits.
The commission has failed to pin responsibility for letting the industry export sugar and claim substantial subsidy. The official argument is that the ECC allowed the export of ‘surplus’ sugar and Punjab announced a subsidy on it in the wake of farmers’ protest against the mill owners’ refusal to start the crushing season on the appointed date. It does not hold much water because it is the government’s job to implement the law and not crumble under pressure from vested interests. Those who cannot withstand such pressure will only be looked upon as having failed the people.

 
 

Covid and the poor

A STARK reminder of the fight against Covid-19 has recently been issued by the United Nations. All things considered, the cost could represent “the largest reversal in human development on record”, according to a report issued by the United Nations Development Programme last week. The authors look at the human cost of the fight in comprehensive terms, from days of education lost for children to aggravation of gender-based inequality and internet access, to name a few. This approach is far superior to others that look only at foregone wages of the poor; it encompasses the many dimensions of poverty as well as providing a more long-term view of the cost impact of the fight against the virus. “The drop in human development is expected to be much higher in developing countries that are less able to cope with the pandemic’s social and economic fallout than richer nations,” the report states, and points to the enduring nature of the challenges that are opening up before us all. This goes far beyond the ‘lockdown versus livelihoods’ debate, which was a non-debate to start with because it pushed the poor to pursue their livelihoods in the midst of a mushrooming pandemic.
Those using the human development approach to the problem are reminding us that deprivation takes many forms and a renewed commitment to equity and social and economic justice is going to have to be a part of the new policy software that governments will have to adopt, regardless of their resource endowments. “This crisis shows that if we fail to bring equity into the policy toolkit, many will fall further behind,” the report’s lead author says, warning that the government’s response will need to go much further than simply enhancing social protection schemes, and certainly far beyond the simple reopening of the economy so that the poor can be made to return to work regardless of the risks posed by the infection. Among the many challenges that are opening up before the government now, the improvement in internet access across the country is a critical one because it is a key enabler of mitigation strategies for the pandemic. Beyond this, education, gender equality and access to health are going to be long-term challenges. The moment clearly calls for a serious rethink of major priorities for countries such as Pakistan where the already depressed social indicators have not made the task any easier.

 
 

England tour

THE Pakistan Cricket Board’s decision in principle to allow the team to tour England in late July for three Test matches and an equal number of T20 games has been well received. Cricket, like all other sports, has been severely hit by the coronavirus pandemic which has either forced cancellation or postponement of a number of scheduled series on the international circuit. So the news of the tour going ahead has come as a relief to fans in both countries. With Pakistan having played some very exciting cricket during the last two England tours, the upcoming series is bound to attract top broadcasters who bring in a major share of revenue for the boards whose coffers are fast being depleted. Having said that, the agreement between the England and Pakistan cricket boards is just the first step. Much will depend on the extent and intensity of the pandemic.
The ECB has briefed the PCB about the strict measures that will be in place for the Pakistan team to guard against the virus. The players would arrive in England early July and be quarantined for 15 days after which they would start training and play practice matches before the first Test likely to begin on Aug 5. The team is to be treated as a ‘family unit’ with no visitors or outsiders allowed to enter the place where the players stay. The team is set to travel with an unusually large contingent of 25 men to cover both Tests and T20s and to play inter-squad matches. And last but not the least, they will be playing in empty stadiums which is a big challenge in itself. Indeed, these are extraordinary measures to cope with extraordinary times. The PCB has acted wisely by leaving the final choice to the players to tour or not. Although most might want to play if things improve, those opting out would be within their rights to do so. If risks remain, the PCB itself should review its decision.

 

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