June 15, 2020 (MLN): The spread of COVID-19 across Pakistan by such an alarming rate has paved the way for the nation’s favorite sport – The Blame Game. While half of the population is in denial, the other half has conveniently termed it as an international conspiracy. Those who do believe in its severity are holding the government responsible for not taking timely and appropriate actions.
Truth be told, the nation at the moment is ready to hold anyone responsible for the pandemic (even Bill Gates), but themselves. We are still stuck at figuring out who started the problem, rather than focusing on the main issue i.e. how to solve the problem. Before carefully analyzing what went wrong and how everything that is happening in the country right now transpired, let us have a look at what exactly is happening in Pakistan currently.
What has happened?
At the moment, Pakistan has as many as 144,478 cases of COVID-19, out of which 88,028 are active cases. The most affected province is Punjab with 54,138 cases, followed by Sindh and KPK which have around 53,105 cases and 18,103 cases, respectively. As compared to its international counterparts, Pakistan Is standing at 15th spot, behind Mexico and ahead of Saudi Arabia in terms of total cases. It may be pertinent to note that in the last fifteen days alone, Pakistan has reported as many as 68,000 additional cases.
The state of the country isn’t too different from the rest of the nations across the globe, in fact, a lot of developed countries such as Germany, the United States, and the United Kingdom have received a much harder blow in the form of casualties and economic crisis. While the same is the case for Pakistan also, the number of fatalities, however, has been a lot lesser.
Speaking of economic crisis, it may be imperative to mention here that Pakistan, for the first time in its history, witnessed a negative GDP growth of 0.38% YoY due to the economic activity being brought to a halt in the wake of country-wide lockdown. According to a report by AKD securities, the industrial and services sectors of Pakistan, too, faced negative growth rates of 2.64% and 0.59% respectively.
According to Pakistan’s Economic Survey that was released by the Finance Ministry recently, the contraction in the GDP was clearly an outcome of fall in the industrial output and business closures during the time of the lockdown.
The good part, however, is that the Agriculture sector reported a growth of 2.67% as compared to the previous fiscal year as a result of an increase in the production of important crops such as Rice, Maize, and Wheat. However, this growth was still lower than the target set at the start of the ongoing fiscal year i.e. 3.5%.
How did it happen?
Having said that, it should be noted that Pakistan’s response to the pandemic was not only frivolous but lacked a whole lot of sense and reasoning. Initially, the authorities failed to conduct meaningful tests on the incoming passengers from Tehran, which resulted in the majority of them testing positive for the virus once they were within the borders of Pakistan.
Subsequently, the nation heaved a sigh of relief after the Government imposed a lockdown in March and instructed the public to stay indoors and businesses to shut down operations. While we still saw cases in huge numbers on a daily basis during the lockdown, there was still some hope that the situation would be controlled in a month or so.
However, all these hopes were crushed and shattered when the Prime Minister, just a few days before the occasion of Eid, decided to lift the lockdown in order to prevent the non-salaried and labor class of the country from suffering financially. The spread of COVID-19 in the country also resulted in an interesting turn of events, wherein the opposition party gained a lot of public support for taking measures that should have been implemented by the ruling party in the first place.
What ensured afterward in terms of public reaction is a story for another day, but the fact that we couldn’t afford a lockdown for even barely two months is what sets us apart from the rest of the countries who are also fighting this pandemic. Right now, Pakistan is being smothered by two perspectives – One, that clearly blames the government for not taking stern actions and measures to prevent the spreading of the virus and second, that blames the mindsets and attitude of the general public for not taking the pandemic seriously.
Whatever the case may be, the ultimatum is that the damage has been done, and there’s little that can be done to reverse the irreverent policies of the government and ignorance of the general public. On the flip side, several corporations and businesses have reopened and resumed operations, which is a positive driver for the economy.
What has been done?
While the immediate response towards the spread of COVID-19 may not have been favorable, the other measures that were taken by the authorities to ease its impact on the business community were widely lauded. The construction package, for instance, by the Prime Minister which entailed several tax benefits, special fixed-rate regime, and the exemption for capital gains, to name a few, helped in lifting the confidence of the business community.
Similarly, the monetary easing by the State Bank of Pakistan four times back to back in the last few months also became a source of respite for many. For the unversed, the State Bank has brought the interest rates down by 5.25% to 8% over the course of two months, which also equates to one of the most aggressive measures taken by any Central Bank across the Board. Besides, the State Bank also offered several incentives to existing and potential borrowers, which include relaxation in credit requirements for export and import.
What could be done?
As already mentioned earlier, the untimely policies of the State as well as the attitude of the general public towards the pandemic has resulted in significant damage. However, there still are some steps that, if taken timely, can help in containing the spread and curbing the impact of COVID-19. According to a report by JS Global, these steps include effective use of big data and machine learning for dynamic risk assessments, which can help in tracking people who may have been exposed to the virus.
Other measures include the use of QR code scanners at public places and residential areas to track the movement of people, imposing strict restrictions on the unnecessary travel and movement of people, development of affordable testing kits, and scaling up production of Personal Protective Equipment such as masks and gloves.
What to expect?
No matter how satisfied or dissatisfied the public is right now with respect to the government’s overall response to the pandemic, the truth is that the authorities have done less than what they were capable of. Whether it’s the announcement of Rs. 1.2 trillion stimulus package or the aggressive monetary policy decisions taken by the State Bank, the State must try whatever it is that can curb the spread of the virus, which includes the implementation of an extremely stern lockdown.
What will happen in the coming weeks, or even months, is something no one can be certain about. The actions of the state have failed to create a meaningful impact, so it is hard to believe that the actions that will be taken after the announcement of the budget would produce a different outcome.
Nonetheless, the silver lining in this entire situation is the possibility of a positive external account, which is expected on the back of a decline in the import bill due to a fall in oil prices. However, as per AKD, this may hold for the short term only, as the medium- and long-term situation of external account will be determined by how the virus situation unfolds.
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