It’s the economy, prime minister
Prime Minister Imran Khan overreacted to the threats of agitation hurled by PPP leader Asif Zardari. The opposition is not presently in a position to initiate any significant movement to overthrow an elected government which hasn’t yet completed eight months in power. The best way for the opposition is to make use of Parliament to expose the administration’s faulty policies, thus educating the general public while simultaneously recording its dissent. Similarly, the sooner Mr Khan stops tilting at windmills and concentrates on resolving the serious problems the common people face, the better for the PTI and the country.
Inflation is going out of control. On Thursday Finance Minister Asad Umar convened a meeting of the National Price Monitoring Committee (NPMC). The conventional ways suggested, like activating market committees, making use of Utility Stores, conducting raids on stores selling medicines or putting in place a forecasting mechanism to ensure availability of essential food items, will only help on a minor scale, and that too in parts of big cities. Unless the Finance Minister can discover some out-of-the-box solutions, his financial ineptitude is likely to blow up in his face soon after the Budget.
While the fall of the rupee has not led to any meaningful increase in exports, it has made local goods with imported inputs costlier. The rise in oil price is a major factor behind inflation. Unless the PTI is able to block the slide, the financial crisis will continue to snowball. On Friday when the dollar-rupee parity climaxed at Rs141.3, Asad Umar assured that the rupee had reached the equilibrium and “there is no reason of big devaluations.” Soon after the dollar started selling at Rs148 in open market, while the SBP reportedly showed unwillingness to issue greenbacks to the market. This was the second big drop in the value of the rupee after September. As things stand the market does not have a great outlook over the next 12-month horizon. This implies that a gradual depreciation may continue in the months ahead until such time the signing of the IMF programme brings some clarity to the table. Delaying decisions has done a lot of harm.