The third Covid wave has, thankfully, saved Pakistan from the worst so far. The inoculation drive is gradually gaining pace, as vaccine supply is able to easily cater to the growing demand. The government’s top functionaries continue to take credit (some of which is deserved) on avoiding a catastrophic disaster such as the one that befell neighboring India over the past two months. But one element that is missing so far, however, is an honest accounting of the socioeconomic impact of the pandemic. This impacts planning.
The Economic Survey has made another attempt this year to assess the initial impact of Covid-19 on economy and society. Some of the insights mentioned in the special section are striking. For instance, the pandemic has made between 44 and 57 percent of the population vulnerable to harsh deprivations of life, thereby requiring sustained assistance from the government. Especially exposed are women, children, daily-wage workers, home-based workers, trans-genders, and persons with disabilities.
While job losses are expected to have been in the range of 13 million to 19 million depending on which methodology is used, it isn’t clear how many folks actually faced loss of income or what was the length of short-term unemployment during the pandemic. Similarly, it isn’t clear how many informal entities among the estimated 3.25 million MSMEs closed down. However, as FY22 saw economic activities pick up, along with restrictive lockdowns avoided for the most part, the debilitating impact may have softened a bit.
The report then adds some substance by citing a PBS survey from late last year, noting that over 27 million working people were impacted by the pandemic, three-quarters of which faced job losses and the remaining quarter witnessed reduction in income levels. Just over a quarter of these affected folks worked in manufacturing-related sectors, a fifth of them were linked with construction sector, and a sixth were associated with transportation and communications-related sectors. Affected individuals resorted to multiple coping mechanisms, including budget-tightening, selling assets, and dipping into savings.
The report also talks about social impact of the pandemic. Covid-19 has disrupted academic lives of 42 million children of school-going age (from pre-primary to college). The loss of learning for kids and income for schools will pose significant challenges for the quality and coverage of education in Pakistan once the situation normalizes. Under healthcare, maternal and child health have been directly affected due to shortage of medications, essential supplies, hospital staff, etc. Besides facing job losses in services sectors, women are over-burdened by increased domestic responsibilities during the pandemic.
The report, which is unable to quantify the pandemic’s socioeconomic impact, highlights the Rs1.24 trillion relief package. But independent review on the efficacy of related spending is unavailable. It mentions the growth rebound from -0.47 percent in FY20 to ~4 percent in FY21, crediting the government’s “timely and appropriate policy measures” for producing a “V-shaped economic recovery”. The report suggests that government’s strategy to spur GDP growth rests on increased PSDP spending and social-safety-net spending, as well as the ongoing vaccination drive. Those are critical pillars that need sustained investment to lift Covid-affected men and women and children out of economic oblivion.