This is a country where strikes, protests, rallies and sit-ins are not rare events; they have become a part of everyday life. And not surprisingly, after every strike or protest, religious rally or sit-in, somebody from the rival camp stands up and says that the economy has suffered from a loss of XYZ billions of rupees.
The trouble, however, is nearly all of those numbers are arbitrary--seemingly based more on whims than well-informed estimates based on economic logic.
Take the case of ongoing PAT and PTI sit-ins. On August 17, the Finance Minister told a private TV channel that Pakistan suffered an economic loss of Rs450 billion due to the two sit-ins in Islamabad. A few days later, the Supreme Court was told that the loss was to the tune of Rs547 billion.
On August 31, this newspaper reported that the Minister for Commerce, Khurram Dastgir Khan, said the loss to the economy has risen to Rs800 billion. The same day, the FPCCI said the loss was to the tune of $10 billion to the private sector, i.e. about Rs1,000 billion.
Four days later, on September 4, Mushahid Ullah Khan, Secretary Information, PML-N, put the number at Rs1,200-1,300 billion.
Going by the same progression, the government can be expected to put the loss number at Rs1,600-1,700 billion today. But common to all these statements is the fact that they are mere guesses, quite possibly biased too. Nor have the PTI or PAT been able to reject these claims objectively.
This is not to say that the economy hasn't suffered a loss; it has. Indeed, due to supply-chain bottlenecks in the north, factories have faced production issues, international credit rating agencies have given a credit negative, perception about the government's stability has faltered, and so forth.
Yet, not one single loss estimate has been backed by any economic logic; not one of the parties mentioned above have even tried to show even a back-of-the-envelope calculation behind these numbers.
Another reason to question the sagacity of these loss estimates is that on annualised basis they are about the size of economy: $10 billion loss in 15 days equals about $240 billion in a year. Since the economy is about the same size, that loss estimate would mean that the economy is literally on a standstill: no goods or services being exchanged at all.
To put into another perspective, the total economic loss from the 2010 super floods, estimated by damages and reconstruction cost, was Rs1,433 billion, according to FY11 Pakistan Economic Survey. Surely, the sit-ins of PAT and PTI aren't as devastating as the 2010 floods.
Since the culture of strikes, protests, rallies and sit-ins in Pakistan are not going to go away in the near future; this column suggests setting up a non-profit venture, whose main job is to provide logically sound estimates of economic losses stemming from such instances.
It should use a pre-agreed methodology and also highlight the loss estimates for the affected sections of the economy.
The body could comprise of businessmen, academics, and other representatives nominated by major political parties, to give it credibility.
And, if and when such a venture is formed, it should also be given the task of scientifically counting the number of participants in strikes, protests, rallies or sit-ins. Otherwise, half of the time, the debate is lost in proving whose rally was the larger one.
Any third-sector entrepreneur willing to take up on this project!?
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