Daily Times

In order to persevere against the economic crisis that seems to have perpetually engulfed Pakistan, the caretaker government has come up with a tried-and-tested argument of “prohibitive” regulatory duties on imports of luxury and non-essential imports. Just a while earlier, Pakistan had followed a stringent ban on imports to keep a check on dwindling foreign reserves. While surpluses in current accounts suggested the remedies were working at first, there came a deafening sound and the Pakistani rupee fell to record lows the minute the government announced relaxations. Furthermore, gains achieved in terms of reducing trade deficits were minuscule when compared to the disasters the import ban spelt for productive and export sectors of the economy.

This time around, the administration is crossing the t’s and dotting the i’s on a much, more all-encompassing plan. There are rumours of at least 30 per cent more products on the forbidden fruits list. For the sake of Pakistan’s fragile economy, it can only be hoped that the government has seen through the merits of unrolling such a plan in a country that does not have a viable local industry to rely on for the majority of these goods. Even more worrisome are the prospects of illegal mafias taking centre stage and smuggled goods flooding the markets. In the past, whenever any such decisions have been announced, the grey forces have entered the formal sector with great fanfare. Because security arrangements can be breached easily, these policies only serve to increase the costs of in-demand goods instead of reducing the quantum of smuggled goods or achieving the end goal. Unless and until those sitting on the helm of affairs plan on a steadfast policy of zero tolerance of smugglers and illegal traffickers, the contemplated duties would only exasperate the small and medium-scale enterprises as they try to manoeuvre through the choppy waters.

It would have been far more beneficial for us to sit with the international lenders for help with restructuring our loan liabilities and focus on improved local production. Perhaps then, closing doors to import shipments or making them outrightly expensive would pull the magical rabbit out of the much-sought-after hat. *