For the love of all that is good, leave Miftah alone!

Petrol prices should never be politicised. But for them to be politicised within one's own party is a new kind of wacky.

It is like clockwork. Every time there is an increase in the price of petrol, minor or major, the government is faced with a series of challenges that dominate the news cycle. It goes something like this. 

First, the opposition benches in parliament rail against the price hike in petrol, accusing the government, the prime minister, and the petroleum minister of being anti-people. Then, the news channels send out television crews to petrol stations where people have queued to buy petrol at the old price before the stroke of midnight. There, they interview people that rant and complain about the increase in the price of petrol. 

After this, opposition parties send their talking heads on television. They spend hours doing live TV in which they rant and complain and hurl vague accusations of corruption. The government, in the meantime, sends meek explanations and mutters about international market dynamics determining prices, not them. Nobody listens. 

The arguments, the news cycle, the process is all nearly set in stone, no matter who is in power and who is in the opposition. Just like birds sing, and Karachi floods in the monsoons, and Saqib Nisar cries himself to sleep every night, it is a fact of life that politicians politicise petrol prices. It is such a regular feature in Pakistani politics that even the saner voices in public discourse have said ad nauseum that there should be no politicisation of fuel prices, and instead, governments should be criticised and encouraged to make cities more walkable and provide better public transport. 

This year around, however, we’ve got a new level of crazy in the house. Not only have fuel prices been politicised, they have been done so not just by the opposition but by the ruling party as well! Maryam Nawaz and by extension the Sharif family patriarch Mian Nawaz throwing his party’s finance minister, Miftah Ismail, under the bus for increasing prices might be a first. 

Of course, much can be said about the state of Jati Umra and the murmurings about PML-N and PML-S that have gone from whispers to loud laughs. But that’s not what we’re talking about here. No. There is only one principled stance here: the finance ministry is not a scapegoat for fuel price hikes.  

Very briefly put, Pakistan is a price taker when it comes to petrol prices. While the import composition of Pakistan primarily consists of fuel, the quantum of fuel imports by Pakistan in the global arena is a spec of dust. This means that when prices move in the international market Pakistan has no option but to buy at those prices. 

Regardless of who is in government, taking credit for a decrease in the price of petrol or taking the blame for an increase in the price of petrol is childish. These are merely movements in international markets being passed on. Then again, the political economy works in such a way that fuel prices, which eventually also act as an indicator of inflation for a layman, are used for political point scoring. 

The very fact that Ismail was indirectly yet publicly criticised by his political party leadership shows how important pandering to the general public is. Instead of making this a moment to educate citizens on the importance of market-based pricing and deregulation,  the party decided to take away some credibility from the finance ministry. This is also not the first time that the ministry has been undermined. Maryam Nawaz often tweets at Miftah telling him to take notice or fix things. Something that could’ve been a WhatsApp message is done publicly in a derogatory way which further undermines the ministry. 

This gives the impression that the ministry takes dictation which should not be the case. The political signalling here could not be any worse. Now you’re probably wondering why this is important. The finance minister’s job entails dealing with various stakeholders. Sometimes this includes negotiating and engaging. 

Acts like these make it seem like the position of finance minister is irrelevant. It takes away the bargaining power that the minister has. Some segments of society might choose to engage with the top leadership instead of the minister because they feel decisions are made top down. 

The finance ministry is a key ministry. Some argue that it is more powerful in terms of impact than any of the ministries combined. After all, it presents the budget, interacts with every ministry and takes key economic decisions that impact everyone. 

I’m also not arguing that a finance minister should be hailed a hero for taking the right decisions. Appreciation is warranted, but scapegoating is unnecessary and damaging.

Political parties when in government need to ensure they put on a unified face. Last month we saw how uncertainty created havoc in the financial markets in Pakistan. Stability is important for economic progress. 

The notion that party leadership and the finance minister are not on the same page is not confidence-inducing for businesses. It doesn’t matter who is in the finance minister seat, whether Hafeez Sheikh after taking tough economic reforms or Miftah Ismail after increasing fuel prices – they should be backed when taking the right decisions. They shouldn’t be given unceremonious exits for taking tough decisions. 

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Ariba Shahid
The author is a business journalist at Profit. She can be reached at [email protected] or at twitter.com/AribaShahid

3 COMMENTS

  1. I agree. Pakistan’s economy requires systematic change and a finance minister should be supported if he is doing the right thing for the country even if the measures are unpopular

  2. I believe Miftah is unqualified for the position because he lacking plans for long-term economic reforms. He is merely buying time to complete the term. The current administration only takes loans and pays its own bills; no reforms are being implemented. They are not developing the assets that would allow them to make money.
    Due to the doubling cost of electricity, businesses will once more relocate to neighboring countries.

  3. What a great article written by one of the smart professional Ariba Shahid. My background is from Finance and economics too, and I assure you will full authenticity that the steps taken by Miftah Ismail are 110% what a real economist must take to save economy of the country.

    I liked argument of Ariba that govt and even state must educate people that price of petroleum is not in control of the governments, and meanwhile politicians must stop politicizing fuel prices for short term political advantage. Why don’t government simple remove regulatory authority and let the market set prices of fuel as it sets prices of other commodities. Shedding this responsibility of controlling prices by the governments will help them focus on legislation and addressing core issues of the country instead of point scoring on fuel prices.

    Good luck, smart girl! I follow you on twitter and it is an honor for me that you follow me back too. God bless you. Keep educating readers.

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