Economic slowdown

The PTI government seems to be carried away by the trade and remittance data for the period between July and December 2018. However, there is a little reason to be elated as the upbeat is illusionary. Trade deficit has reduced marginally, accounted for by a small reduction in imports and a modest growth in exports despite the hefty devaluation. The compression of imports in December resulted from lower oil prices and slower import of machinery as a result of economic slowdown. Incentives given to augment the exports, besides the cheaper rupee, have not produced the result. FDI has declined owing to unfriendly business environment, uncertainty and inconsistency in policy making. The growth in remittances has slowed during November/December which may be due to global economic slowdown and trade tiffs.

The alarming thing is the decline in the reserves of the State Bank, despite the injection of bailout funds received from friendly countries. The ruling party lacks a robust economic plan to take the country out of the prevailing crisis.

Kulsoom Arif ( Karachi )