Dawn Editorial 4 June 2021

Trade deficit

PAKISTAN’S trade deficit has expectedly widened sharply during May, the ministry of commerce data showed on Wednesday. The gap between what the country sells to the world and what it buys from it ‘ballooned’ last month by 134pc to $3.4bn from $1.5bn a year ago. That the nation’s import bill for the month shot up by a hefty 77.8pc to $5.1bn during the month is attributable to last year’s lower import base when the import bill dropped to $2.9bn on the back of the drastically reduced domestic demand because of the Covid-19 pandemic and consequent economic shutdown to halt the spread of infections. The more than 25pc drop in the monthly exports also contributed significantly to the widening trade gap. The trade deficit has been increasing since December primarily because of faster growth in imports than in exports. Overall, the gap has expanded by 29.5pc to $27.3bn in the 11-month period between July and April from $21.1bn in the same period last fiscal year. Imports rose by 22pc to $49.9bn and exports by 14pc to $22.6bn. But the question is: should we be worried about the rising gap between what we import and what we export?

There’s not much to worry about the rising import bill. This was expected. Two factors have played a major role in the increased import bill this fiscal from last year. First, the import of food, including wheat and sugar, and cotton have pushed imports more than was estimated at the beginning of the financial year. Next year, these imports are expected to moderate on better domestic crop yields. Two, the revival of economic activities and a surge in the demand for Pakistani exports has driven up imports of raw materials as well as machinery for technology replacement and capacity expansion. Moreover, the country’s current account remains in surplus in spite of the widened trade deficit as the surging remittances have largely offset the impact of increased imports. The external sector is unlikely to face any serious financing challenge in the next one to two years if the remittances continue to grow at the same pace. But the long-term balance of payments stability requires the government to boost exports through product and market diversification. Additionally, it must tweak its policies and learn to respect contracts it makes with investors to give confidence to investors for attracting longer-term, non-debt creating foreign direct investment flows to sustainably grow the economy.

Covid-19 & education

EDUCATION and learning have suffered substantial, and in some ways permanent, setbacks in Pakistan during the pandemic. Schools were intermittently closed due to rising cases and ensuing restrictions, and though private, high fee-paying schools managed to take teaching online so students were not totally left behind, public and low fee-paying schools missed out in a huge way. For these schools, digital learning was and is simply not an option. For millions of students, not only did learning and teaching not take place during the closure period, there was also the serious problem of lost learning that occurs when students disengage from school. When students return to schools after each closure, teachers confront lower levels of retention and have to reassess their expectations of how much a student can catch up given how badly schooling was affected.

Compounding the problem, a World Bank estimate suggests that around 1m children will drop out of school as a result of income losses during the pandemic. Given that 22m children in Pakistan are already out of school, the additional dropout figure represents an increase of almost 4.2pc. A study conducted on the disruption of schooling during the 2005 earthquake in the northern areas showed that an entire cohort of students from three to 15 years of age at the time of the disaster had lower academic scores four years later, despite substantial remediation efforts. The pandemic-induced school closures – which have coincided with the three waves of Covid-19 – have brought similar, if not worse, disruptions.

When it comes to decisions on education, the role of the government leaves much to be desired. Aside from the hue and cry over university and college examinations, there has been no conversation about or support extended to the millions of children who have been pushed out of the education process during the pandemic. Reopening schools when cases are low is simply not enough, given how high the dropout rate is. What efforts are being made to re-engage students who have permanently left school? With households reporting a fall in income during the past year, what is the government doing to persuade poverty and hunger-stricken families that education is a priority?

The government has some serious work to do. As schools reopen, officials must acknowledge the terrible setbacks to education and devise a long-term plan. This strategy must address the digital divide as well as the huge blow to girls’ education, already regarded as being of secondary importance in families where incomes are strained. Interventions must be planned around these challenges, given that with new variants and low vaccine coverage, a fourth and fifth wave are very real possibilities. As the government mulls its next steps for the educational sector, mass vaccinations and testing must be rolled out to ensure that future disruptions do not push learning towards an irrecoverable collapse.

Forgotten Rohingya

WHILE the plight of the Rohingya has been overshadowed by the Covid-19 pandemic and February’s military coup in Myanmar, the fact is that the community remains in no-man’s land, with many of its members lacking citizenship and its attendant rights. Around a million Rohingya refugees reside in Bangladesh, living in deplorable conditions, while others have sought refuge in countries across the globe. Many members of the community were forced to flee when the Myanmar military launched a pogrom against them in 2017. The situation was particularly tense in Rakhine state, with reports of rape and murder against the Rohingya rife. Myanmar faces charges of genocide in the International Court of Justice for these outrages. Meanwhile, the living conditions of the community in refugee camps are pathetic; several thousand have been dumped on a Bangladeshi island far from the mainland without job opportunities and proper healthcare.

While many in the international community have rightly slammed Myanmar’s junta for overthrowing an elected government, the plight of the Rohingya must not be forgotten. Along with a return to representative rule in Myanmar, the international community must also demand justice for the Rohingya. For long Myanmar’s ruling generals have pushed the xenophobic trope that the Muslim Rohingya are ‘outsiders’ in the Buddhist-majority nation, despite the fact that members of the community claim their roots in the country formerly known as Burma go back generations. Even the quasi-democratic government of Aung San Suu Kyi did not have the courage to speak up for the fundamental rights of the Rohingya. It is these circumstances that led the UN to terming the Rohingya the most persecuted minority in the world. Myanmar cannot be allowed to disenfranchise an entire community, while those responsible for violence against the Rohingya must be brought to justice. In the meantime, countries that host Rohingya refugee communities must treat them in a humane, dignified manner and ensure that they have access to healthcare, education and employment opportunities.