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Print

Covid-19 versus economic output: Government struggles to strike much-needed balance

The federal government has decided to restore some industries and has tasked the Ministry of Industries and Production to prepare SOPs (Standard Operating Procedures) in order to allow these industrial sectors to operate 'to an appropriate level' as part
Published 02 Apr, 2020 12:00am

The federal government has decided to restore some industries and has tasked the Ministry of Industries and Production to prepare SOPs (Standard Operating Procedures) in order to allow these industrial sectors to operate 'to an appropriate level' as part of the government's strategy to maintain a balance between the preventive measures against COVID-19 and the running economy.
The Ministry of Industries and Production, which is currently preparing these SOPs, will share them with the Ministry of National Health, Regulations and Coordination for the latter's input and its subsequent approval before these SOPs come into effect.
Speaking to Business Recorder, Deputy Chairman Planning Commission Jehanzeb Khan said those SOPs would then be sent to the provinces for their implementation, adding the committees, which had already been constituted, would oversee the implementation of the SOPs in the industrial sector.
The industries that would be restored include cement, textile, chemical, soap, garments, pharmaceutical, petroleum, energy etc, he said. "If we completely lock down industry, the consequences on our economy would be unbearable. We can completely lock down industry for two weeks but the serious challenges posed by the outbreak of coronavirus are not going to be over in two weeks.
Therefore, we need to follow a practicable and pragmatic policy; to strike a balance between the preventive measures against this pandemic while ensuring that our industrial sector does not collapse. Keeping this in view, it is inevitable to allow some key industries to operate while strictly following the SOPs devised by the federal government," he said.
Moreover, he said, the cutting of wheat crop for the upcoming summer season, call centres as well as other industries would be allowed to operate. "In different industries, especially the garments sector, the related Pakistani companies have signed mega contracts with their foreign clients for exporting Pakistani garments on large-scale.
If these consignments are not delivered as per the signed contracts, Pakistan's exports would suffer massively which would put pressure on the rupee," the deputy chairman Planning Commission said.
"Likewise, the cement industry is like the backbone of any country's economy. It also has to be restored. We simply cannot afford to shut down the industries like cement, garments, soap, pharmaceutical, petroleum and energy for long."
Like the federal and provincial governments, it is the foremost responsibility of the industrialists to ensure social distancing and other precautionary measures against coronavirus at their industrial premises, Jehanzeb Khan said.
"Strict measures need to be put in place in the industries and businesses located in the congested areas across the country," he added. The transport of the industrial and commercial goods throughout the country needs to be completely restored in order to ensure that there is no shortage of any commodity, the deputy chairman Planning Commission told Business Recorder.
Requesting anonymity, a former finance minister, who is also a renowned economist, said, "It is important to strictly monitor the number of coronavirus cases in Pakistan and the mortality rate. If there is a decline in the trend of the COVID-19 cases as well as the mortality rate, then the industries should gradually be restored. However, if things go the other way, then strict preventive measures need to be taken."
He also agreed that SOPs need to be put in place for the gradual restoration of industrial sector. "If we resort to a blanket lockdown, this will have adverse effects on our economy. Even developed countries cannot afford complete lockdown and have refrained from shutting down completely due to disastrous economic implications," he said.

Copyright Business Recorder, 2020

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