Inflation has gone up to a five-year high of 10.34 per cent on the back of rising housing, transport, and food prices. The continuing slide of the rupee against the dollar has also been a factor, for which monetary tightening has been suggested as a solution. Reports suggest that monetary tightening will do little to improve the situation, as the former categories are influenced more by their own unique factors.
The State Bank of Pakistan has also increased its estimate for inflation in the current fiscal year to between 11 and 12 per cent. This may go against the claim made during a recent TV interview by PTI’s former finance minister, Asad Umar, that inflation would peak in the next four months.
Also worrying was that, in the same interview, when Umar was asked if the economy had improved since he was replaced as finance minister, he tiptoed around an affirmative response instead of saying that the direction of the economy was the same as the PTI has adopted since day one. That direction, unfortunately, does not appear to be up. While time may prove the PTI’s policies right in the long run, there appears no sign that the short term guarantees any rewards, as the crippling weight of inflation continues to turn the middle and lower classes into a nation of Quasimodos.
Even on the growth front, plan to create an export surplus and attempt import substitution have serious flaws — namely, what can we export to fill a trade gap of around $25 billion, and how can we substitute imports with quality domestic products? Lest we forget, locally-assembled automobiles, phones, and other products often can’t compete on price or quality with their foreign counterparts, even with tremendous tariff protection.
Meanwhile, massive fines in international arbitration caused by the judicial activism of former Chief Justice Iftikhar Chaudhry and others have left Pakistan with legal bills amounting to billions of dollars. While these are unlikely to come due in the next few months, the nature of the cases was such that we need to be prepared to pay out at some point.
The belt is unlikely to loosen soon.
Launching into space
As the world celebrated the 50th anniversary of man stepping onto the moon, the Federal Science and Technology Minister, Fawad Chaudhry, announced that Islamabad too was planning to send the first Pakistani into space.
The news was widely welcomed as a coming-of-age of Pakistan’s nascent space programme. He then recently sat down with The Express Tribune and offered much-needed clarity on proclamations of sending a Pakistani into the vast empty void of space in a mere three years.
The first bit of clarity was that the entire burden, whether monetary or technological, would not be borne by Pakistanis. Rather, it will be a Chinese mission which will essentially carry Pakistan along with it. The minister pointed out that the plan to send a Pakistani into space dated back to the early Musharraf era which had set the target of a space flight for 2015.
Per Chaudhry, the space programme is essential to Pakistan’s development, especially in the fields of defence energy and even agriculture. Pakistan sent its first satellite, the Badar-I, into space in 1990 with help from China. However, the native space programme has been slow in progress since.
Even though the science minister did not admit it, undoubtedly the 2022 deadline to send a Pakistani into space is driven by how India plans its first manned space mission for the same year. India, unlike Pakistan, has the resources to dedicate $1.4 billion towards the project apart from a successful space programme which has already sent probes to the moon on its own rather than relying on any other country.
If anything, this is another round of one-upmanship between the two arch-rivals. That sending a man into space for Pakistan is essential because India is doing so and we must not be upstaged.
Do we need a space programme? Dr Abdus Salaam, the country’s first Nobel laureate, certainly thought so and guided its foundation. Do we need to send a man into space just because of India? Probably not.
Cleanliness drive in Karachi