According to Dr. Kaiser Bengali, an eminent economist Pakistani economy is mostly run by mafias, who often join politics and the government to get “legal benefits.”
These mafias enjoy monopoly profits, which they use to further strengthen their political designs.
Dr. Bengali, who remained Advisor to the past governments in Sindh, Balochistan and Centre, while speaking at an online post-budget 2020-21 webinar on Sunday said sugar, wheat flour, fertilizer and paper industries are minting money by availing various subsidies and incentives in the form of tax exemptions. Most of the owners of these industries are either in the government or they are relatives of the ministers.
“You have heard about the sugar scandal and a good thing has happened that an inquiry report has been made public, which exposed how the sugar mafia is looting the national wealth by adopting all “legal procedures.”
Describing further, Dr. Bengali said the sugar mafia provides wrong figures and manipulates the situation for their benefit. First, they export sugar and claim subsidies on exports then create a shortage in the country to raise its prices. These sugar mill owners are mostly politicians, who often make policies for their benefit. Sugar mills are not paying properly costs to sugarcane growers and swindle taxes like FED and GST through manipulation.
Flour mills receive wheat from the government’s procured stocks at subsidised rates. The main aim of this incentive is that they would supply flour at lower rates. In fact, these mills purchase wheat from the open market and then sell flour at higher by mixing the rates. “They put the subsidy on wheat in their pockets and sell flour at higher rates,” he said.
In Pakistan, three paper mills have created a cartel, which has made many publishing houses bankrupt as they sell paper at higher rates. “Now the situation is such that most of the curricular books, even in Urdu are published and imported directly from China and Indonesia as there is no import duty on published books. The paper mafia is so powerful that every year the government announces to change the duty structure, but it always fails to do so.
He said most of the fertilizer manufacturing units are owned by the Military subsidiaries in Pakistan, which receive Sui (natural) gas at very cheaper rates, almost free, and also receive subsidies on the selling of fertilizer to growers.
It is a matter of fact that more than 60 per cent of fertilizer is being used by Punjab, whereas Sindh consumes only 20 per cent. The Sui gas-producing province Balochistan consumes only 4 per cent of the fertilizer, thus most of the subsidy goes to Punjab at the cost of smaller provinces like Balochistan and Sindh that produce the natural gas.
“We have not seen the reverse transfer of the benefit from Punjab to Balochistan,” he said adding that Punjab does not provide any subsidy to Balochistan while supplying wheat the people of Balochistan have to purchase wheat at the market rates.
Watch the entire speech: Click here
