THE peace process in South Asia moves in fits and starts: things look up one moment, only to come crashing down the very next. The last few years have been particularly tense, with the situation along the Line of Control volatile, while the two states came to the brink of another war in 2019 after India’s Balakot misadventure. However, of late it seems that efforts are under way to cool temperatures and restart the dialogue process, apparently through the backchannel.
The first sign of this thaw came last month, when the respective DGMOs established contact and announced resumption of the ceasefire along the LoC. Further signs that something is afoot came on Wednesday when Prime Minister Imran Khan, speaking at the Islamabad Security Dialogue, said that India should make the first move to normalise ties, while adding that Kashmir was the “lone irritant” standing in the way of better Pakistan-India relations. On Thursday, the army chief made similar comments at the same forum, saying it was time to “bury the past and move forward”, while again highlighting the need to resolve the Kashmir imbroglio.
The prime minister has a point because after the LoC ceasefire, India, being the bigger regional power, should initiate the dialogue process. Earlier on, Mr Khan had also said that if India takes one step towards peace, Pakistan will take two. The fact is that in the current atmosphere, the resumption of the dialogue process itself will be a major achievement. A state of perpetual conflict suits no one, particularly the millions of poor in South Asia, while better relations can pave the way for socioeconomic uplift for all. As the COAS noted at the Islamabad forum, South Asia is “amongst the least integrated regions of the world” and defence spending “comes at the expense of human development”.
However, as positive as the signals appear, it would be premature to celebrate ‘talks about talks’. Both countries have been at a similar juncture before, where negotiations had reached an advanced stage and peace seemed imminent. However, the process was derailed and soon it was back to square one. Such mistakes have to be avoided this time around and interlocutors on both sides need to tread carefully without raising expectations.
The progress achieved in earlier discussions should be built on, and so-called soft areas — people-to-people contacts; Sir Creek etc — can be a starting point to reach the tougher issues on the agenda, such as Kashmir, militancy etc. For starters, hawks on both sides must be sidelined so a conducive atmosphere is created for dialogue as there will always be noisy lobbies for war in both countries. Constituencies for peace need to be strengthened so that the complicated issues poisoning ties since independence are resolved, and South Asia can move forward on the journey of human development and economic progress.
LSM growth
THE large-scale manufacturing industry posted a robust growth of 7.85pc during the first seven months (July-January) of the financial year, signalling the revival of economic activities after the protracted gloom of harsh IMF-mandated stabilisation policies and later by the Covid-19 shutdown. Even though the expansion in LSM output remains narrowly based and is not unexpected given the low-base effect, many are projecting GDP will record higher growth than the targeted 2pc this year compared to the 0.4pc contraction the previous year. This is so in spite of new data from the Pakistan Bureau of Statistics showing slightly slower LSM growth in January compared to the two previous months. The rebound in large-scale industry, which represents almost 80pc of the country’s total manufacturing and accounts for 10.7pc of the economy, after a contraction of over 10.5pc last fiscal year, is a hopeful sign. It not only signifies a substantial uptick in the domestic consumption of cement and other building materials, but also an increase in textile and clothing exports, leading many to invest billions in new projects, as well as in the expansion and upgradation of existing ones. Nonetheless the upturn remains fragile. Some likely adjustments such as increased energy prices and the withdrawal of certain tax exemptions for corporations for the revival of the suspended IMF programme could slow down LSM recovery and diversification of businesses. The lower interest rate and cheaper long-term financing for investment are a key factor driving LSM expansion. Any change in the present dovish monetary policy once the IMF programme is again operational could also trigger a negative impact on industrial recovery.
While industrial output has expanded, generating economic optimism, the agriculture sector remains a weak link in the economic chain. With food imports rising by 50.3pc to $5.3bn year-on-year in the first eight months of the fiscal year to February, the widening trade deficit may bring the balance-of-payments position under pressure. Additional burden on the external sector is coming from cotton and yarn imports to meet the local textile industry’s demand in the wake of the failed crop this year. The share of food items — eg wheat, sugar, edible oil, spices, tea, pulses — in the import bill has reached 15.8pc this year compared to 11.3pc last year. Economic revival requires the government to also focus on investment in agriculture to improve output. The poor performance of the farm sector could cancel out the gains of the manufacturing sector.
Another 500,000 doses
WITH the third wave of the coronavirus pandemic tearing across the country, the arrival of another 500,000 doses of the Sinopharm vaccine from China is welcome news. Like the first batch, this one too is a gift from the Chinese government. On top of that, the first consignment of the privately imported Russian Sputnik V reached Karachi on Wednesday, although it will be a few weeks before batches are dispatched to government-approved inoculation centres. Another Chinese vaccine, the one-shot Cansino, is expected by the end of the month.
It is essential that Pakistan purchase sufficient doses to inoculate enough of its population so that herd immunity can be achieved. Given that the vaccination campaign got off to a somewhat lethargic start, with even many health professionals — who were eligible in the first phase — reluctant to receive their jabs, the government needs to put more effort into getting public buy-in. According to government data, in the first two weeks only 32,582 front-line healthcare workers out of 78,000 in Sindh got their first Sinopharm shot, with other provinces doing even worse. Until a few days ago, only 240,000 out of an estimated 8m Pakistanis over 65 years of age had registered themselves for vaccination; that works out to 3pc of those eligible. Vaccine aversion, mainly arising from misinformation and mistrust of official data, is a very real problem in this country — although one might have hoped the health community had more confidence in a scientifically proven procedure. With inoculation centres largely carrying out their task smoothly, and more first-hand accounts available about the vaccine causing few to no side effects, the pace may pick up. Nevertheless, this is an area that the authorities should look to pay more attention to. On a related note, the government has made a sound decision in revising its earlier intention to not place a price cap on privately imported vaccine. That would likely have put the jab out of reach of all but the most well-heeled Pakistanis.
