REMITTANCES sent home by Pakistanis living and working abroad continue to surge, defying the economic slowdown resulting from the Covid-19 pandemic. State Bank data shows that diaspora remittances jumped by a hefty 29pc to an all-time high of $24.2bn during the 10-month period between July and April of the ongoing financial year when compared to the cash sent home by overseas Pakistanis during the same period a year earlier.
April saw remittances spike to an unprecedented $2.8bn, up by a whopping 56pc from the previous year. The 10-month aggregate has also exceeded expectations and the full level achieved in the last fiscal year by over $1bn. Saudi Arabia continues to be the largest source of remittances to Pakistan followed by the UAE, UK, EU and the US. Pakistan is now in sixth position amongst the top 10 recipient countries of workers’ remittances globally, and is likely to move up at least one place by the end of this year.
The central bank claims that proactive policy measures to encourage more flows through formal channels, curtailed international travel, altruistic transfers to Pakistan amid the health crisis, orderly forex market conditions and, more recently, Eid-related inflows contributed to the surge in remittances. This continuing growth has also lessened concerns of an economic slowdown in countries hosting the largest pool of Pakistani workers, which had caused remittances to dip at the start of the pandemic. In its new report, the World Bank has attributed the steady remittance flows to fiscal stimulus that resulted in better-than-expected economic conditions in the host countries, the shift in flows from cash to digital and from informal to formal channels as well as cyclical movements in currency exchange rates and oil prices. The 17pc growth in remittances to Pakistan in 2020 was faster than the combined 5.2pc increase flows to other South Asian nations, says the World Bank.
Workers’ remittances are the single largest source of foreign currency for Pakistan ahead of exports. They provide key support to currency and forex reserves by bridging the balance of payments in the face of reduced dollar flows from other sources. The rising remittance flow has so far helped support the current account that has posted a surplus of $959m, creating a semblance of external-sector stability. But the contributions of expats can do only so much. The other important component — financial account — of the balance of payments continues to be in deficit as FDI plummets, equity investors pull out their money from stocks, foreign debt payments jack up, and amortisation and other outflows increase. Overall, the external sector appears stable for now and the government is unlikely to face any difficulty in financing its debt and other payments for the next year or two. But the long-term external sector outlook will remain fragile without a dramatic increase in exports and direct investment inflows.
Debating poll reform
THE PTI government is pushing ahead with its version of electoral reforms that focus on the introduction of electronic voting machines and enfranchising overseas Pakistanis. In a latest move to shore up support for EVMs, Information Minister Fawad Chaudhry had a model machine showcased in parliament so relevant stakeholders could be briefed on its working. The minister said parliamentarians would be better informed for a debate after getting familiar with the EVM and its benefits. The opposition has so far remained non-committal about the EVMs while the ECP has expressed reservations about their utility. However, there should be no rush to judgement. Now that the government is lending its full weight to these and other reforms, it will be useful if parliament can thoroughly debate the pros and cons of the EVMs. There is plenty that needs to be dissected in this regard. Across the world many countries have had varied experiences with their usage and all these should figure in an informed debate in parliament. The matter can also be debated threadbare in the committee constituted for electoral reforms. It may be important that hard data about the success and failure of EVMs across the world is made the basis of the discussion in the committee and experts or consultants are brought to provide indepth assessment of the EVMs. The ECP should also play its role and provide well-researched conclusions to parliamentarians so they can make an informed decision. It goes without saying that the public too must be educated in their intricacies.
Meanwhile, the matter of enfranchising overseas Pakistanis, while fairly persuasive conceptually, may be burdened with various complications. Some overseas citizens carry national identity cards, others have NICOPs and some other variations and these all require clarity in terms of their eligibility for voting. This aspect in itself could open up a Pandora’s box and generate controversies regarding the right to vote. It is therefore important that parliament weigh each and every proposal carefully and deliberate upon it without any timelines or deadlines. These reforms should be beyond partisan agendas. They are meant to strengthen the democratic system, not the electoral prospects of any one party. In this spirit therefore they need to be fleshed out in as much detail as possible before any decision can be made. The government should not make the mistake of rushing for a decision through a vote. Let parliament take the high road for once.
Political vendetta?
IN Pakistan, crossing certain ‘red lines’ carries an inherent risk. But it is truly alarming when such actions invite harsh reprisals even during an ostensibly democratic government. On Monday in Multan, a district administration team razed commercial buildings and a marriage hall owned by the son-in-law of Javed Hashmi, veteran politician and perennial maverick. The family alleged that besides these constructions, two poultry farms, the wall of an educational institute and a residence belonging to them were also demolished. According to the authorities, the demolition was part of a drive against illegal construction in the area. The official handout pointed out that the approval of the design of the marriage halls was not obtained from the tehsil council. It added: “The action against all illegal constructions is being taken without any discrimination and political affiliation.”
Circumstances surrounding this operation, however, strongly suggest an underlying political motive. A few days before the district administration swung into action, Mr Hashmi in a social media post had excoriated political meddling by the establishment and reminded them of constitutional limits on their power. Given that PML-N is at the moment taking a ‘softer’ approach towards the civil-military imbalance, none of his party colleagues seconded his views. The senior PML-N leader is not known for political correctness, and has even spent a few years behind bars during Gen Musharraf’s regime for bringing to light matters that the powers that be preferred should remain hidden. He has rubbed military and civilian leaders alike the wrong way by his bluntness. Monday’s actions however, constitute a new low in the ongoing vendetta against opposition figures. According to reports, the family was given no advance notice of the operation, which took place on the first working day after Eid holidays, and was thus unable to approach the courts for a stay. Moreover, the buildings were razed on a technicality that, if applied without discrimination, would lead to a vast number of constructions being torn down in many urban centres in this country.
