Prime Minister (PM) Nawaz Sharif has warned the Finance Ministry against setting unattainable goals for the upcoming budget. The PM seems to be conscious of public perceptions about his government’s policies and wants to avoid making claims that cannot be fulfilled, like his claim of ending load shedding within six months and the repeated statements by the Interior Ministry and the military that they have virtually eradicated terrorism in Pakistan. The goals for past budgets have often been unreasonably high and the government has not been able to meet them, which is why the PM’s prerogative for this budget has been to set realistic targets to avoid disappointing the people and being criticised by the opposition. Finance Minister Ishaq Dar had projected a six percent increase in the Gross Domestic Product (GDP) growth rate, which should be five percent according to the PM. The finance minister praised the economic policies of the incumbent government, saying that although they had inherited a failing economy they had turned it around. He claimed that the PML-N government has boosted the growth rate to four percent, reduced inflation, brought down circular debt in the power sector and reduced the fiscal deficit. However, this reduction in the deficit and inflation is mainly due to the fall in international market prices, particularly those of oil. International prices can be mercurial and trends can vary over time; it is not sustainable for the government to rely on the falling prices of commodities and fossil fuels as a solution to inflation and the trade deficit. The economy is admittedly in a relatively better state than it was a few years ago and the PML-N government is committed to boosting it further and embarking upon trade and development projects with other countries, like the China-Pakistan Economic Corridor (CPEC). Pakistan has passed the test of the seventh International Monetary Fund (IMF) review and is expected to receive the next instalment of the IMF grant. Yet the IMF has found certain areas in which the government has failed to reach some of the targets that they had set, for example the tax net has not been expanded sufficiently. Tax revenue remains less than 10 percent of the GDP and the Finance Minister is expected to raise it to 13 percent, which seems unlikely. The Prime Minister has cautioned the Finance Ministry against overburdening those already taxed and to increase taxes on the rich and affluent. The government will have to find a way to compel those who do not pay taxes to do so by closing tax loopholes and redressing the flaws in the tax collection system. The PM has also cautioned the Finance Ministry against raising taxes on gas, as was suggested at the budgetary meeting. In the past year however, the government has been raising gas taxes, despite the international fall in prices, like the recently promulgated development cess. The government was criticised by the opposition for passing the Gas Infrastructure Development Cess Bill without due consultation with the smaller provinces, who have protested the bill, and criticised not presenting it before the Council of Common Interests. The government’s attempts to widen the tax net in the last fiscal year have failed, forcing them to scramble for revenues by increasing indirect taxes on other sectors. Despite the PM’s clear instructions to the Finance Ministry to set realistic targets for economic growth, the benefits of which should trickle down to the common people, it remains unclear what steps the government will take to widen the tax net without overburdening the masses. Neither direct foreign investments nor domestic investments have gone up significantly, in spite of the government’s efforts. The PML-N government’s focus is on development, with the majority of the development budget being allocated to CPEC, whilst cutting down on vertical development projects for the provinces — a move that the federating units have protested. While the government’s efforts to boost the economy are appreciable, they will face several hurdles along the path to development and will have to keep the welfare of the smaller provinces and common people in mind. *