The Pakistani rupee continues its seemingly inexorable slide down against the dollar. And word on the financial street, II Chundrigar and elsewhere, is that the slide will continue. It is this common knowledge that is feeding into the slide as a negative feedback loop, furthering apprehensions of further slide, as such situations tend to.
The Letters of Credit (LCs) of our importers were first being turned away by local banks (allegedly upon unwritten instructions by the central bank, and now, it would appear that getting foreign banks to agree to them is also getting to be difficult. That situation has led to a piling up of shipping containers that aren’t being offloaded or despatched. That pile is only going to get bigger.
We are an import-led economy. There is an understanding that a slowing down of imports is going to lead to falling standards in lifestyle, yes, but we often forget what all we tend to import. The humble daal, staple of awami eateries and kitchens across the country, is also largely imported. Forget that, even if we had been growing our own pulses, there is no way we can survive without furnace oil. Our fuel import bill is large and we just don’t have the foreign exchange to pay for it.
The need of the hour is, in addition to political stability, a need for the political parties, across the board to get together and figure out a bare minimum consensus in order to deal with situations like these. Talk of a “Charter of Economy” could be idealistic and impractical because the very nature of politics is somewhat adversarial. But politics is also the art of the possible. The political class needs to get together and eke out a way of making sure there is never a situation where political bickering leads to the roof caving in.
