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Year of Growth | Editorial

While the prime minister might have exaggerated the effect of recent upside surprises in export and inflation figures a little, there can be no denying that whatever he said about the need to make business-friendly policies and incentivise industry was spot on. And there can be nothing better than the government dedicating all its energies towards making 2021 a year of growth. But for that the start would need to be rooted in ground realities rather than a false sense of optimism from some recent, very temporary trends. Low inflation, for example, is natural when there is very low growth. So it’s good but not in the way we need it to be, especially since there is still artificial inflation in items of daily, necessary use; which itself speaks volumes about the state of the economy.

And exports have impressed, but that is because we faced the first wave of the coronavirus much better than others, just like the PM said, and it enabled us to capture some markets lost to producers still in lockdown. But how long can that trend last now that Pakistan is also firmly in the grip of the second wave and there’s no telling really when things might turn for the worse? The right thing to do, as the government is very righty doing, is target industries with export potential and prop them up for enhanced and improved production. Yet that too would first require a comprehensive audit of previously called zero-rated industries that were given all sorts of support for the longest time possible and there was still not much improvement in exports.

The good thing about the prime minister’s new year’s resolution is that it gives the feeling that the government has decided that increased revenue through improved exports is the way forward. Hopefully we can now begin the long process of identifying new export trends and transforming our own production machinery accordingly while all the time concentrating on value addition in our export mix. Governments usually shy away from such long-term projects because more visible items like power plants and motorways tend to fetch easier votes. But they fail to realise that such projects nonetheless generate a wealth of jobs and earning in the process, so it is actually unfair to deprive the electorate of such opportunities. So far this administration seems determined to go ahead with such a revolutionary transformation of our manufacturing sector. Let’s hope that it succeeds.

Source: https://dailytimes.com.pk/708729/year-of-growth/

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