Rizwan Ghani
A lot is being said about US, China, and India. This is a fight for national trade interests. In Covid-19 world there is no space for war and Washington and Beijing are both aware of it. China will continue to firmly safeguard global economic interests with public benefit before corporate interest. How the new economic system takes shape will become clear after US presidential elections. But it is evident that trade and economy are going to be the basis of new economic alliances in post Covid-19 world. How should Pakistan deal with this situation with its weak economy?
The answer is simple. Islamabad should make trade and economy its top priority and should not waste time on any event or country. It should adopt a foreign policy that supports our interests. In this regard, we should focus on our public and forget betraying friends. We should meet those who respect us because this is our religious teaching. Our decisions should be based on facts which will take us out of this economic crisis. We should avoid western economic system (Bretton Wood 1944) which has made poor poorer and rich richer in last 5 decades. We need to change our economic model so that governments serve public not IMF. Pakistan can strengthen its trade and economy with domestic consumption based economy. It is very important to use value addition technology in agriculture sector. It will boost SME manufacturing at cottage level, improve food security, create millions of jobs and help end poverty. In agriculture sector the areas could include sectors of diary, poultry, fishery, cattle, produce related food processing including wheat, rice, corn in form of noodles, biscuits, breads, preservation and packaging of fruits and vegetable.
There is lot of scope in large scale manufacturing sector. The use of steel mills can stop current $3bn annual imports. Steel industry in China has modernised its economy, construction, infrastructure and manufacturing. Development of China railway in last 3 decades is case in point. Today China is exporting bullet train technology, railways tracks etc to the world. Steel is backbone of China’s BRI which is connecting the world. Pakistan can follow its model and use our locomotive factories to manufacture railway coaches, railway tracks and link with Europe. Our steel, railway and construction sectors have been destroyed by collusion of politician-related mafia. It is grave mistake to give incentives to construction mafia. Govt should give public incentives to build houses to earn more revenue. If city development authorities are allowed to develop and sell plots, it will create jobs and boost businesses at local level. The current construction policy will give construction companies mega profits without giving government any revenue in return because tax policy has already been skewed in their favor. This is how mega corruption is destroying Pakistan. All programs should be made to benefit and all tax free schemes should be scrapped. Taxes should be collected on all incomes.
There is need to adopt renewable energy for number of reasons including cost of production. Beijing’s energy policy played an important role in making it an economic super power, an export giant, following independent foreign policy and meet international clean energy standards. China has added 4000MW of solar energy in first 3 months of 2020. Pakistan can shift 20 million houses to alternate energy in no time with same amount of money that it uses on fuel import, circular debt, line losses and allied corruption. Germany shifted domestic heating and cooking to renewable energy 20 years ago. In 2019, its exports were more than $1.5 trillion. China has used IT to reduce poverty. China relocated 700 million people to lift them out of poverty, build economy and create jobs. We can relocate 30-40m people to Baluchistan for similar results. Now China has given 5G access in rural areas with under $10 monthly packages to cut cost of living, create more jobs and improve economy.
It has allowed government to reduce spending on urban infrastructure, policing and crime control and digitization has increased its revenue, improved transparency and reduced corruption. The excess cash can be used for educating and creating jobs for youth with help of short IT courses. We can use 5g technology for our food security and control population migration to urban centres. Under the US Homestead law, a family was given 10 acres of government land for agriculture purposes and it stayed with them as long as they continued to occupy it and grow crops on it. Govt can make a national food security policy with help of IT, seed banks, agriculture land, agriculture based water reservoirs and IT qualified youth. Finally, countries have intelligently used their resources and populations to become world’s leading economies. The changes in global alliances are an opportunity for Pakistan to take a fresh start. We should ignore all those who have abandoned us and focus on making Pakistan strong and independent with help of domestic consumption based economy, IT, renewable energy, food security plan and traditional banking and financial system.
—The writer is senior political analyst based in Islamabad.
