PAKISTAN is facing unemployment, economy and security challenges. According to official figures, over 5.3 million people will be unemployed by the end of 2015.Budget observers have raised concerns that the finance ministry’s claims of creating 2.5 million new jobs in 2016 are unrealistic. Ahsan Iqbal, federal minister for planning and development, also disputed the accuracy of the ministry’s unemployment figure of six percent in 2013-14 compared to 6.24 in 2012-13 (Economic survey).In addition to the budget policies, our policy makers can incorporate technological, physical and e-commerce advancements in the region to improve the employment, economy and security.
Unemployment and poverty can be reduced by relocating the population. In the 1960s, America enacted its Homestead Law in 13 states to create jobs, boost its agriculture and improve food security. China also relocated 200 million Chinese under its poverty alleviation program in the last decade. Pakistan can also employ one and half million families by relocating four to five million Pakistanis living below $1.25 a day to Balochistan and sparsely populated regions from Punjab and Sindh. Another two million of such people can be relocated to other areas of Pakistan in line with master plans of socio-economic uplift including China-Pakistan economic corridor (CPEC). The relocation of population can protect national interests. There is a need to bring more people to scantly populated regions which our enemies are using to destabilize the nation. The Army chief made it clear in his statement at Pakistan Naval Academy in which he said that ceasefire violations and the bloodshed in Baluchistan, Karachi and the Federally Administered Tribal Areas (FATA) are manifestations of the enemy’s hostile intent. Washington established cantonments in Nebraska to protect gold mines. Islamabad needs to use combinedphysical presence of people with cantonments and allied security infrastructure to protect ourgeo-economic and geo-strategic interests in the country and the region.
Water and agriculture. With predictions of lower rainfall during the coming monsoon season, government should help farmers develop farm ponds to store rain water as a short term measure to make up for water scarcity. India is adopting the same measure. Government should also develop small dams and canals to store and channelize flood water for future use. By providing electricity through alternate energy, value addition can be improved starting with dairy, meat and produce followed by grain products. The combination of renewable energy and value addition can bring $200 billion of business to the national economy. It is pivotal to adopte-commerce.The success of Alibaba shows its importance for part of national economy, budget and revenue. The company will sell $1 trillion worth of goods by 2020. Its gross merchandise volume for 2015 was $393 billionand it increased 46% from last year. It has enabled millions of US small businesses to sell directly to China’s middle-class consumers which today is as big as America’s entire population, and in a decade will grow to half a billion people. Now the company will import fresh produce from Mexico, Brazil and Argentina for Chinese consumers.
The Baidu Navigation Satellite System will help carry out China’s Belt and Road across the globe. China is cooperating on satellite navigation with a host of countries, including Australia, Indonesia, Pakistan and Singapore. The system will help businesses, agriculture, transport and mobile phones (free text messages).
The start of Chinese cargo train services has opened new options for Pakistan. China has started cargo train service from Xinjiang to Moscow (10 days). It can transport $8.1 billion of cargo a year. Pakistan by linking Mardan to Xinjiang can accelerate land access of Pakistani exports to Asia, Europe, and CARS much ahead of completion of CPEC. Other routes include China-Spain (crosses 7 European countries in 24 days) and China-Kazakhstan (12 days). China is now focusing on these areas to improve its economy. Earlier it used urbanization, population relocation, wage increases, improved standards, renewable energy and railway to keep business cost low. Urbanization, relocation and more disposable income due to higher wages has helped increase sale of electronics, cars, houses and travelling. Railway and renewable energy has helped keep business cost low. Investment in railway has also paid off in terms of reduced rents, cutting travelling time and congestion, improving Chinese exports to Europe, Asia and CARS.
As China’s neighbor, Pakistan should look at $500bn annual exports. Mexico has daily $1.25 billion ($456 billion annual) export to USA. China is pushing for improving tiny and small businesses and linkinge-commerce platforms to improve domestic consumption and exports.Our policy makers should also help small Pakistani businesses exportgarments, shoes, jewelry, leather, consumer goods, silver utensils, surgical and sports goods, furniture, software, pharmaceuticals, agri-products and produce to China.The government should impose fair taxes (7% flat tax) and adopt transparent and supportive policies. Policies of tax breaks and SRO’s totaling over Rs 665 billion have failed to produce results.
—The writer is senior political analyst based in Islamabad.
Unemployment, Economy & Security | Rizwan Ghani