Pakistan’s headline inflation rose to 11.5pc in November, 2021, the highest in 21 months. In fact, consumer prices in the country remained the highest as compared to other regional countries. According to the government’s own estimates, inflationary pressures would persist and people would continue to suffer in the months to come.
The Pakistan Tehreek-i-Insaf (PTI) government claims to have put the country on the right track in its three years in power and hopes people would soon start getting relief from rising prices. However, the opposition sees worsening of all economic and social indicators and warns the remaining term of the government would be even tougher. According to the government, it has stabilised the economy after inheriting the worst internal and external crises and managed the biggest global Covid-19 threat by successfully balancing lives and livelihoods in the country. It is a fact that despite internal and external challenges, economic indicators suggest that the country is moving forward now. Pakistan’s economic performance has been appreciated by international organisations, including the World Bank, International Monetary Fund (IMF), Asian Development Bank, Moody’s and Fitch.
Pakistan’s current account posted a deficit of $7.1 billion (5.3 percent of GDP) in the first five months of the current fiscal year against a surplus of $1.9 billion (1.6pc of GDP) last year. Previously, the current account deficit was $7.2 billion (5.5 percent of GDP) during July-Nov FY2018, according to the ministry of finance. The current account deficit widened due to the constantly growing import volume of energy and non-energy commodities, along with a rising trend in the global prices of oil, Covid-19 vaccines, food, and metals. On the other hand, remittances, which keep the economy afloat, rose by 9.7pc to $12.9 billion in the five months. According to the central bank, the country received $2.4 billion in November, a 0.6 percent uptick year-on-year, but fell 6.6pc compared with the previous month. The trade gap widened 133pc to $4.9 billion in November. The State Bank of Pakistan (SBP) said workers’ remittances had continued their strong streak of remaining above $2 billion since June 2020.
The government also offered several benefits to the business community while no new taxes were imposed in the budget despite the fact that the country needed extra funds to tackle the pandemic and challenges created by it. Huge incentives were offered to enhance exports and encourage investments. The government also took drastic measures to curtail its expenditure by reducing the budgets of the President’s House and Prime Minister’s House.
Pakistan is also among a few countries which tackled the coronavirus pandemic successfully – a strategy appreciated by global leaders, including philanthropist Bill Gates. A relief package of Rs1,240 billion was announced, including cash transfer, to support vulnerable communities. The timely decisions by the government helped mitigate huge losses. The government’s policies on electric vehicles and mobile manufacturing are two significant steps, which will generate jobs and boost the economy. To mitigate the suffering of the vulnerable segments of society during the pandemic, the government launched the Ehsaas programme, the country’s biggest ever social safety net, under which Rs145 billion were distributed among 12 million daily wagers. The programme has been enhanced to reach 16 million people.
Pakistan also played a pivotal role in intra-Afghan dialogue. Its relationship with China is evolving into a strong economic partnership as the second phase of the China Pakistan Economic Corridor (CPEC) has started. On the diplomatic front, a dramatic shift can be seen from isolation to effective representation after the PTI government took over in August 2018. Despite India’s attempt to isolate Pakistan at regional and international forums, Prime Minister Imran Khan raised the Kashmir dispute at the United Nations General Assembly (UNGA) and other platforms. Pakistan also successfully hosted an OIC FMs’ conference in Islamabad recently.
On the other hand, the main opposition parties claim the PTI government has damaged the country beyond repair. They are trying to create instability and unrest in the country through rallies and rumours. When the opposition failed to put pressure on the government through agitation and its alliance broke up, it started creating rumours and arranged talk shows that Prime Minister Imran Khan could announce general elections anytime. It is a fact that the government is under no pressure from any quarter to hold snap polls and the rumours only aim to create political instability in the country. Even if elections are held, the opposition is not in a position to win, as the Pakistan Peoples’ Party (PPP) cannot bag many seats from other provinces, except Sindh, while the Pakistan Muslim League-Nawaz (PML-N) faces serious rifts and it will be difficult for it trounce the PTI in its stronghold, Punjab.
It is a fact that the three years of the PTI government have been the hardest for the people of the country. Prices of food, especially wheat flour, sugar and cooking oil, have gone beyond the reach of the common man. The government increases the prices of petroleum products almost every fortnight. Power and gas tariffs have also been revised upward. The rupee depreciated by over 33pc against the dollar, which increased the prices of everything.
Undoubtedly, the three years have been a difficult period for the people. The government believes it has performed best in the difficult circumstances while the opposition claims the PTI rule has been a total disaster for the country and it failed on all fronts. It is a fact that the government’s performance has been below par so far. It failed to stabilise prices and provide jobs to people.
People are not happy with the government, though economic indicators have improved. However, the opposition parties cannot blame the PTI for the poor state of affairs, because they are responsible for it. They have remained in power for decades but failed to address Pakistan’s chronic problems.