In conversation with Finance Minister Mir Arif Muhammad Jan Hasni

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Mir Arif Mohammad Hassani is a Pakistani politician who is the current Provincial Minister of the Balochistan for Finance, in office since 30 August 2018. He was elected to the Provincial Assembly of Balochistan as an independent candidate from Constituency PB-34 (Chaghi) in the General Elections 2018.

Q: How has the accountability mechanism been improved and strengthened by the present government?
Arif: As is always said by PTI Chairman Imran Khan that the culture of accountability at the government level can only be strengthened when the top leadership practices it, similarly, in Balochistan our leadership Jam Kamal Khan, CM Balochistan is an honest, visionary and competent person. He has a vision for corruption free governance in the province. We as his team are doing our best. For me it was a challenge to accept the department of Finance in view of corruption cases in the department in the recent past due to which the image of the province was damaged badly. However, Alhamdulilah, today I can proudly say that we have almost eliminated this menace from Finance Department. The reason is obvious that neither I ask any official of the undue department nor I will tolerate any undue favor to anyone else by any official of the Department. So we are setting up a culture of professionalism and fair play in the Department.

Q: How do you plan on curtailing circular debt in the province?
Arif: In Balochistan we don’t have any circular debt problem except some pending liabilities of QESCO, which require reconciliation by QESCO with the energy Department. I am sure that is not a big issue and will be resolved amicably.

Q: It has been said that each MPA (for Quetta) is allotted Rs 100 crore per year, is that true?
Arif: The perception of allocation of funds to the MPA’s in Balochistan is entirely misunderstood, which is not correct. I had heard about allocations of funds for certain development schemes on the proposals of the MPA’s, which had been in practice in the entire country. I think it will take us sometime to restrict our MPAs/MNAs to the role of legislation only. So far it seems difficult because people who vote for them expect development works in return and I think there is no harm in taking the elected people on board in the development projects of their constituencies and they can help me to expedite the development projects by engaging the people of the area. As far as the allegation of Rs 3000 crores to MPA’s of Quetta during the past five years is concerned, I think it’s not correct.

Q: What part of revenue generated from Saindak project is being spent/used in Balochistan?
Arif: Saindak project is basically a joint venture between MCC China and SML, Ministry of Petroleum and Government of Pakistan. The Balochistan Government initially is getting only 2% as royalty, which is deposited in GoB account. Under the Aghaz-e-Haqooq Balochistan package, Federal Government has announced to provide 30% of its shareholding to Balochistan. But during this period FBR came with an argument of less payment of income tax by SML and they had taken over substantial amount of funds from the accounts of SML on that account. Hence GoB gets only royalty whereas the Federal Government has paid no substantial amount to the GoB against the transfer of shares. The only major benefit being availed by GoB from Saindak is the employment of more than 1500 people.

Q: The previous CM Sana Ullah Zehri has allegedly renewed contracts of the Chinese companies already working at Saindak, without any auction to allow other companies to participate as well, is that true?
Arif: I think this is not the correct perspective of the Saindak Lease Extension Case. One has to understand that is it possible to have a competitive process when one company has invested so much for years on a project in terms of developing infrastructure and other related things. It was practically impossible and I think the previous government extended the Lease of Saindak project with all good intent.

Q: The district system was abolished in 2008, now each district has an MPA, whom the public cannot reach more often than not. Why not reintroduce the Nazim system with each area being a designated Counselor the locals can reach?
Arif: I, myself remained District Nazim of Chaghai District during the period of Local Government System introduced by General Pervaiz Musharraf and probably I was the youngest District Nazim at that time. In principle, I agree that the problems of the people need to be resolved at their doorsteps but what type of system of Local Government will be more effective that needs to be well thought out. The Nazim system had many good things but at the same time it had some drawbacks as well especially the law and order situation got deteriorated due to weak coordination and chain of command in the LEAs. Therefore, our Provincial Cabinet constituted a Committee on this matter, which will examine the existing Local Government Act and come up with recommendations which will be placed before the Cabinet and Provincial Assembly for approval.

Q: It was stated in 2017 by the previous Government that the Bank of Balochistan will be launched by the next financial year, which is this year. However, there are no designated funds for the project in the Budget 2018-19. Why is that?
Arif: The proposal of establishment of Bank of Balochistan has already been placed before the Provincial Cabinet in its last meeting. The Cabinet decided to have a feasibility study first, which is a pre-requisite. Once the feasibility is done through a reputably firm, further course of action will be taken.

Q: Previous attempts of Provincial Government at operating banks have failed (with Bank of Punjab, in KPK and in Sindh) how do you justify launching and operating a bank in Balochistan?
Arif: As I mentioned in my response in your previous question that we are going to conduct the feasibility of setting up the bank the bank first. Once the feasibility is done than we will proceed further. But in any case we are clear in our approach that we will go for a bank which is competitive like any other scheduled bank and Government of Balochistan will have negligible interference in its functioning. However, we would like that the bank of Balochistan would promote business in the province through its instruments, create more jobs and attract investments.

Q: What is the Ministry’s plans to set up funds for the sports sector and for academic scholarships for talented students?
Arif: As far as provision of scholarship to the talented students is concerned, Government of Balochistan is already running a major scholarship program through Balochistan Education Endowment Fund (BEEF). Whereas, for promotion of sports, there is a full-fledged Department with divisional and district level support staff mandated with the promotion of sports in the province. In addition, Government of Balochistan is sponsoring special sports events i.e. National games etc. Moreover the Government of Balochistan is also considering provision of special allocation at the disposal of all the Deputy Commissioners for arranging sports events in all districts of the province.

Q: There is a large part of population of the province who cannot afford proper health care, as expressed by the CM a few days ago. How are you planning to help these people?
Arif: Our Government has special focus on health and education. We are taking all measures to ensure that our health facilities are made functional. I along with Health Minister personally visited Civil and BMC hospital particularly Trauma Center to have an idea of their requirements. We in Finance Department assured the Health Department of our full cooperation subject to delivery of quality health services to the people. To meet the urgent requirement we are also considering appointment of doctors on contract basis, for which required posts in all the district level hospitals have been provided. In nutshell, we will take every step, which help us improve our healthcare system, and I am confident that we will be successful in our effort Insha Allah.

Q: Balochistan is the largest province of the State in terms of area. The population is spread across very long distances. What are the plans to fund and execute development programs in the more remote areas?
Arif: It’s a tough question. As you know, Balochistan is 44% of the country in terms of area but gets only 9% share from the divisible pool. So our resources are limited and need for development of infrastructure as well as governance cost is too high compared to other provinces. It is becoming difficult for us to maintain a balance between available resources and development need. At the same time it is difficult to make equitable allocation of available resources amongst all the districts and achieve economic growth so we are working in multiple areas, which includes in enhancing our own source revenue and revision of weightage criteria of inverse population by NFC.

Q: The PSDP of Balochistan is Rs.88 billion with a deficit of RS. 61 billion. However, the designated budget for development in the province is allegedly the largest in the history of the province, and it has also been stated this development budget was set without considering the available resources. Is that true? If not, what are the resources for this budget?
Arif: Yes it’s true that the Budget Estimates for the year 2018-19 presented before the provincial Assembly by the previous government had a deficit of Rs.61 billion meaning by that the expected expenditure was estimated at Rs.61 billion more than the estimated revenue. Apparently, it is difficult for our government to manage it because the deficit is on very high side which is in no means can be financed. You know that the Provincial Government begin a sub national government cannot go for external borrowing on their own. Our own sources of revenue are estimated at Rs 15 billion only. On the other hand, our non-development budget mainly comprising of salary, pensions, subsidies to agriculture tube wells and expenses on Law and Order is increasing, leaving little chance of saving. So in this scenario, it is almost impossible for us to finance the deficit. The only option left with us is to leave our development project un-financed during the financial year 2018-19. We are exploring all options to have a win-win situation.

Q: Where is the majority of the provincial revenue being generated from?
Arif: Currently, Balochistan Sales Tax on Services is the major sources of tax revenues of GoB. Mines and Minerals and Excise Taxation are the other major sources of revenue in the province. But every department has a role to contribute in the revenue of the province.

Interviewed by:
Hamna Malik and Imaan Zia

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