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Sunday March 03, 2024

Depoliticizing the economy

September 10, 2022

Extraordinary situations warrant extraordinary actions. Sometimes opening borders with hostile neighbours for trade and humanitarian assistance becomes essential. The recent catastrophic floods in Pakistan have made such decisions imperative.

The devastating floods, an outcome of climate change in which the share of Pakistan is said to be minimal as compared to the rest of the world, have wreaked tremendous havoc on property, human lives and crops across the country. Food security has become a real challenge, snowballing with every passing day. The crunch is being felt in the escalated prices of vegetables and shortages of essential edible commodities. To meet this challenge the option of trade with India was explored and then quickly dropped off due to political backlash.

Alternatively, the government has allowed the duty-free imports of onions and tomatoes from Afghanistan and Iran for four months through the Torkham, Chaman and Taftan borders to arrest the rising prices of vegetables in the domestic market in the aftermath of the heavy floods. This will bridge the shortfall of production in the border towns of Balochistan, Khyber Pakhtunkhwa and Sindh to some extent.

But the quantum of imports from Iran and Afghanistan at present is not sufficient to meet the rising demand. The government will have to explore other options to import from other countries including India, because local crop destruction coupled with the current heightened demand cannot be catered to by imports from Afghanistan and India alone.

Before trade with India was suspended in August 2019 on political grounds, tomatoes and onions were a regular import item from India. In the current crisis, resuming this trade on humanitarian grounds for a specific time period will be a good option to arrest the food shortage and cap the escalating cost of these two essential commodities. This will help these essential vegetables reach Punjab and its vicinity immediately, stabilize their prices, and incur low logistical cost as compared to importing from anywhere else. This will back up the inflow of vegetables from Iran and Afghanistan, which is not sufficient so far, and will provide relief to consumers across the country.

Trade on humanitarian grounds trumps all political rhetoric and negative propaganda. In the recent past, Pakistan allowed 50,000 metric tons of wheat from India to cross its border in transit to Afghanistan to address the Afghan humanitarian crisis. This was despite the fact that imports were suspended from India, but due to an extraordinary dire situation of a neighbouring country, the Pakistan government allowed the transit of these imports from India under the World Food programme after adopting the proper procedure and formalities.

This step did not incur any negative media publicity or political backlash both internationally and nationally. Ours is a dire situation too, and it needs intervention. Why are we not responding proactively to the domestic food crisis by rising above politics? There is no harm in allowing imports from India temporarily to meet the domestic challenge of an acute food crisis in the country until major problems in restoring agricultural production are addressed.

The other main challenge at present is to continue supplying food to Afghanistan uninterrupted. Pakistan provides a vital supply route into Afghanistan as large amounts of food aid enter via the port of Karachi and transited through Pakistan by road to Afghanistan. The devastating floods have threatened the Afghan food supply due to badly damaged roads, and this will place huge strains on efforts to get food to Afghanistan’s 38 million people facing a desperate humanitarian crisis, aggravated after billions of dollars in assets were frozen by the US when the Taliban took over in August 2021.

Amidst the heavy rains that caused flash floods across the country, cement sales have plunged by 34 per cent in local dispatches and recorded a 44 per cent decline in exports during the first two months of the current FY2022-23. Pakistan can export cement to India if borders are allowed to open. This will augment the sales of cement and jack up exports adding to the national exchequer at a critical juncture. Cement has been one of the major export items to India.

The pros and cons of trade with India are usually debated at length. However, without making the issue hostage to political bickering and keeping emotions at bay, if a decision is made to import from India for a few months in view of the imminent food crisis, it will be a step in the right direction and will alleviate the misery of millions of consumers who are suffering from acute shortages of food items and a crushing rise in the cost of essential commodities.

The writer holds an LLM degree in international economic law from the University of Warwick. She can be reached at: beelam_ramzan@yahoo.com