Rule by consultants

IT is odd that the government has recruited former State Bank governor Reza Baqir as a consultant to work on building its Sovereign Wealth Fund. Baqir has little experience building organisations. Besides, his tenure at the State Bank has left a legion of unanswered questions. Baqir entered the State Bank amid high inflation and an abrupt change of guard at the finance ministry, when Asad Umar was ousted unceremoniously to be replaced with Hafeez Shaikh. Pakistan signed an IMF programme within a fortnight of Shaikh’s arrival, something Umar had struggled with for almost seven months. Interest rates were already high in those days since Pakistan was still recovering from severe balance-of-payments stress as well as a period of high inflation fuelled by record-high printing of money. Direct government borrowing as a proportion of total broad money supply crossed 50 per cent in May 2019, having spiralled from early 2017.