Stories about economy

Will imported tomatoes help tackle rising prices?

In an attempt to tackle the rising prices of vegetables and fruits in Pakistan, the government finally caved in on Wednesday and allowed for tomatoes to be imported from Iran. The Pakistani masses have been bearing the brunt of the nation’s economic woes, but that burden has been worsened recently after the prices of tomatoes began to rise due to faulty economic polices and bad weather which adversely impacted harvests. But perhaps this desperate reaction to reach to Iran for some much needed tomatoes was the result of Abdul Hafeez Shaikh’s, the prime minister’s financial adviser, much ridiculed gaffe earlier in the week. One ...

Read Full Post

What does Pakistan’s improved ‘Ease of Doing Business’ ranking mean?

The World Bank’s latest rankings of 190 countries on the Ease of Doing Business (EDB) is out.  Pakistan did well, considering it moved up 28 rungs on the rankings ladder, from 136th place to 108th.  In this latest round, Pakistan is one of 10 countries (Saudi Arabia, Jordan, Togo, Bahrain, Tajikistan, Kuwait, China, India, and Nigeria) that have improved the most across at least three of the 10 factors that go into constructing the EDB rankings. The annual report received wide publicity on its arrival because the rankings matter. They reflect how conducive the regulatory environment is for opening ...

Read Full Post

Can demonetisation help address Pakistan’s FATF concerns?

While many in Pakistan celebrated after hearing the news that Pakistan had survived ‘Indian lobbying’ attempts to get Pakistan onto the Financial Action Task Force’s (FATF) black-list, it would be foolish to think that a position on the grey-list is something to be proud of. FATF’s primary duty is to be a global watchdog which curbs money laundering and terror financing, and while Pakistan has assured the task force that the nation will achieve the set targets, the likelihood of this happening still remains circumspect, especially given the wide array of problems the nation is already facing. Undoubtedly, the pace of ‘progress’ is far below ...

Read Full Post

What can Pakistan learn from this year’s Economics Nobel Prize winners?

Abhijit Banerjee and Esther Duflo of Massachusetts Institute of Technology (MIT) and Michael Kremer of Harvard University won this year’s Nobel Prize in Economics. Congratulations to all three Nobel laureates. In their ground-breaking research, the three transformed the way developmental issues are studied, showing what works and what doesn’t. Their adoption of the experimental approach and particularly the use of random control trials, used mostly by biologists, in developmental economics is considered ground-breaking. Experiments open the door to understanding and knowledge, and rather than assuming what would work or wouldn’t, their approach looked at experimental data to come to a ...

Read Full Post

As Asian economies take centre stage, how can Pakistan cash in?

The economic map of Asia is changing at a fast pace, shaped by trade disputes between the United States (US) and its trading partners, and by commercial developments in Asia, especially in China. The Trump administration is using tariffs, and the threat of higher tariffs, to leverage its bargaining positions and extract trade concessions through negotiations with China.  While policymakers in the US and China are struggling to come up with a joint communique, business executives are going to the drawing board to decide what to do next.  A key decision for these businesses is what to do with ...

Read Full Post

Why should Pakistan change its export policy?

In the current inhospitable economic climate prevailing in Pakistan, leading to rising inflation alongside a worsening trade and fiscal deficit, the nation desperately needs a solution to these growing list of problems. While it is fairly simple to understand that an increase in exports will benefit the economy, the method through which this can be achieved is a slightly more tricky question to answer. Exports will help pave the way towards economic prosperity by improving Pakistan’s Balance of Payment (BoP), but policies which try to lead Pakistan in this direction can only be implemented once we address the question: why does Pakistan have ...

Read Full Post

Why is the Indian government ignoring all the economic red flags?

Owing to a “weaker than expected outlook” for domestic demand in India, the International Monetary Fund (IMF) has projected that India’s growth rate will undergo a downward revision by 0.3% for the fiscal year 2019-20. As the Indian media and government keeps deflecting rising economic concerns, the massive economic slowdown that seems to impact a vast majority of the Indian public has led to the ringing of alarm bells in some quarters. The government statistics for the first quarter of the year (Q1) showed that the Gross Domestic Product (GDP) grew by 5%, the lowest Q1 growth rate India has ...

Read Full Post

Why PM Imran Khan should first worry about his own country and then Kashmir

While Pakistan has tried to raise the Kashmir issue on the global stage, Prime Minister Imran Khan has to realise that that is really all he can do. The Foreign Office and Shah Mahmood Qureshi will now continue to raise a voice for the people of Indian-occupied Kashmir (IoK) on the international platform, and Imran should now focus on the domestic issues in Pakistan. After all, that’s what he was elected to do. But this seems unlikely. Here are a few things that Imran should focus his attention towards instead. Economic turmoil The current budget deficit has soared to Rs3.45 trillion, ...

Read Full Post

Putting the Balochistan budget on the right course

Whenever a new government assumes power, either at the centre or in a province, they often state that the economic woes are inherited from the financial challenges of previous years. The Balochistan Awami Party (BAP) led coalition government in Balochistan seems to be repeating this mantra. However, there can be no denying of the fact that the present government inherited a deficit of over Rs62 billion, in addition to billions in liabilities and unforeseen expenditures. But what led the Balochistan government to this position, where the blame is being passed from one party to the other? The policies enforced by both ...

Read Full Post

Taking from the poor, giving to the stock brokers – who is PTI’s priority?

The incumbent government of Pakistan Tehreek-e-Insaf (PTI) has just increased the price of petrol by Rs4.26 per litre and it intends to introduce more indirect taxes in the upcoming budget in order to minimise the deficit in the budget. However, surprisingly, recently the PTI government approved a package of around Rs20 billion for stock exchange brokers and it was termed as a package to end the uncertainty in the Pakistan Stock Exchange and give confidence to the stock market. However, since the package is actually being given to the wealthier stock brokers, it begs the question that at a time when ...

Read Full Post