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RGST issue, Zardari asks for Nawaz help

ISLAMABAD: Amid political uncertainty in the country, President Asif Ali Zardari on Sunday extended an olive branch to PML-N chief Nawaz Sharif, seeking his cooperation for getting the controversial Reformed General Sales Tax approved from the National Assembly and addressing some other important issues, including promulgation of a new accountability bill, threats to democracy and political instability.

Zardari asks for Nawaz help on RGST issueIn reply to Mr Sharif’s letter of Nov 10 in which he had raised some issues and concerns, the president wrote a letter to the PML-N chief inviting him to nominate senior party representatives to jointly take difficult decisions required to take the country forward.

The president’s spokesman, Farhatullah Babar, said the letter had been delivered to the former prime minister’s residence in Raiwind.

However, PML-N spokesman Ahsan Iqbal said that his party chief had not received any letter so far, but heard reports about it through the media.

Mr Iqbal said the PML-N would not support the RGST bill because it considered it against the people. “Instead of extending a hand of friendship towards Mian Nawaz Sharif, the government should utilise its energies for the elimination of corruption,” he added.

The president in his letter sought the cooperation of PML-N on the RGST issue and reminded it that its nominee, former finance minister Ishaq Dar, and some other senators of major political parties had unanimously recommended the GST law with some 15 amendments.

“The Senate adopted those recommendations along with the bill, and referred it to the National Assembly. We also hope for your support in the National Assembly for the passage of this important reform measure,” the letter said.

A copy of the letter has also been sent to Prime Minister Yousuf Raza Gilani.Taking note of PML-N chief’s concern about the Accountability (Ehtisab) Bill, the president recalled the history of how the proposed bill passed through successive stages of legislative process before the PML-N protested that amendments proposed by them had not been incorporated.

“The chairperson of the standing committee has decided to reconsider the bill and to deliberate upon the outstanding issues arising out of the dissenting note of PML-N’s members,” the president assured Mr Sharif.

Pointing out the need for the restructuring of public sector enterprises (PSEs) for pursuing the economic reforms agenda, the president sought Mr Sharif’s support. He said: “We will be grateful if your party facilitates the government in its restructuring plans for these entities, and extends support tour policy to promote public-private partnership to protect Pakistan’s national interests.”

“A cabinet committee on restructuring of PSE has already been formed and a comprehensive plan for restructuring of the power sector companies has been launched with the aim of bringing the private sector into the management of the distribution companies,” the letter said, adding that the restructuring of power sector companies would bring a saving in excess of Rs250 billion in 2011-12.

Reshaping PSEs

Outlining the plans for restructuring of PSEs, the letter said: “A restructuring plan of Pakistan Railways has also been approved and work initiated to convert Pakistan Railways over a period of 3-4 years into a profitable organisation.

Business plans are under preparation for all other loss making PSEs like Pakistan Steel Mills, Pakistan International Airlines, Trading Corporation of Pakistan and Utility Stores Corporation, with a time frame of 4-6 months for implementation.”

The president sought cooperation of PML-N in pursuing the economic reforms agenda through the restructuring plan.

Defending the policy of not giving indiscriminate subsidies, the president said: “A subsidy can only lead to the fiscal indiscipline that Ishaq Dar referred to as finance minister, and will contribute to inflation indirectly by increasing the fiscal deficit.”

Mr Babar said the president shared the concerns expressed by Mian Nawaz Sharif over the increase in petroleum and electricity prices and urged the former prime minister to “appreciate that POL prices in Pakistan are linked directly to international market prices, and are free from the government interference”.

The president said in his view “the seeds of Pakistan’s current energy deficit were sown by the reversal of power policy in the aftermath of the end of Benazir Bhutto’s second term in office (in 1996)”.

“As a result of this policy 5,653MW were added to the national grid in a record span of three years by allowing a uniform rate of 6.5 cents per KW to the IPPs for a locked period of 20 years as compared to 18 cents per KW today. The failure of successive governments after the dismissal of ours to attract investment in this sector has created a supply shortage that will take time to clear. Unfortunately, there is no magic wand that can be waved to restore investors’ confidence and remove the deficit of 15 years, overnight,” he said.

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