OPINION
Ariba Shahid
ernment assumes this will help increase exports, it is important to note how dangerous bans really are. For starters, they create grey economies and the need for smuggling. We’ve already seen an influx of iranian cooking oil and dairy products smuggled into the country in addition to the petrol smuggled in from time to time. The government is effectively creating a grey economy. These bans also help push up prices of domestic goods and elcome to Banistan, a country where Youdon’t necessarily result in local efficiency. The more protected Tube, tiktok, imports and FX accounts are your local industries are the more they take you for granted. blocked on a whim. Please enjoy your stay What’s more important is that this pattern of banning things is here, we don’t know how long until that’s not new. In the past Pakistan banned the import of cheese. Till banned too. date there are no large scale cheese substitutes. A fundamental right in today’s However, this is also a reminder of the past when the modern world is the right to choose. The right to choose who governs simplest solution is to hurt consumer and investor sentiment. Deyou, where you live, what you study, what you eat, etc. However, spite their best efforts, the PMLN ghost of freezing FX accounts in today’s world we’re spoilt for choice. That isn’t necessarily a bad may never die down. thing. Despite that, the government is stifling our thoughts and makPrime Minister Shahbaz Sharif belongs to the Pakistan ing choices for us. Muslim League Nawaz (PMLN). His brother Nawaz Sharif has Between March to June, Pakistan is expected to spend a whopserved as Prime Minister thrice before. However, while he is ping $2 billion on subsidies that have yet to be withdrawn. Instead of remembered as a Prime Minister that conducted nuclear tests in choosing to do the right thing and rollback subsidies, the government Pakistan despite mounting international pressure, the financial is up with another gimmick - public austerity by banning luxury community remembers him for the repercussions of that testing. goods from being imported. This, however, is not the smartest move The Chagai-I, five underground nuclear tests at Ras Koh in the book. Hills in 1998, were celebrated throughout the country on the For context, our choices are being taken away in vain. It won’t streets. However, internationally, Pakistan had to face reperhelp. The monthly impact of the ban on the import of 38 non-essencussions and condemnation. The United States, Japan, Austratial luxury items under an emergency economic plan announced on lia, Sweden, Canada, and more importantly the International Thursday will merely be $247 million. Monetary Fund (IMF) imposed economic sanctions on Pakistan. Mariyum Aurangzeb, information minister, however claims The As a result, all new US economic assistance to Pakistan was ban will have an impact of $6 billion [Rs1.2 trillion]. While the govsuspended. In order to deal with the uncertainty and to curtail the FX outflow, the president at the time, Rafiq Tarrar imposed a state of emergency. The government ordered banks to remain closed across the country, the Karachi Stock The writer is a business Exchange (now Pakistan Stock Exchange) was shut, and all foreign currency accounts worth $7 journalist at Profit. She can billion were frozen. The finance minister at that time, Sartaj Aziz called the measures necessary to be reached at ariba.shahid@ stop the flight of foreign money which could lead the country to bankruptcy. pakistantoday.com.pk or at It is, however, unlikely for Pakistan to face such embargoes and sanctions over its actions, twitter.com/AribaShahid thus low chances of warranting such a move. However, with reserves dwindling, no support coming through, and the government being adamant on closing the fuel subsidy over losing political clout - one never knows. This suffocating ban on imports will solve nothing. This will only buy time until someone becomes strong enough to take the tough step and increase fuel prices. How many things will you ban until you make the right move?
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