If the price hike of petrol and gas hadn’t already agitated the masses enough, now the government has indicated towards a further increase over the next couple of months.

The Adviser to the Prime Minister on Commerce, Textile Industry, Production and Investment Abdul Razak Dawood has tried to reassure the country by saying that in order to put the economy on the right track, people will have to put up with the inflation for some time. Does the government truly have a good fool-proof plan to revive the economy to make the first few months of hardship worth it?

There are several factors which indicate that the government is moving at a trial and error basis to fix the economy and that might end up doing more harm than good.

According to reports, the government’s foreign exchange reserves have increased along with the tax revenue and there is a fair reduction in the import bill. Minister of State for Revenue stated that both the Current Account and Trade Deficit have now shown sharp declines of 22% and 11% respectively from July till February 2019. This is a sign of an improving economy but only if you ignore all other aspects at play. The government, at the moment, needs experts who understand the local business sector. A focus on imports, without focusing on the exports and the growing increase in smuggling is a policy which will not outlive the government. It is the prerogative of the Prime Minister to give priority to innovation and promote entrepreneurship, but with the expected inflation, not only local business but entrepreneurs will also face a crunch. With costs of production going up, the government planning to reduce subsidies, the economy can only move towards hyperinflation which results in loss of revenue for the stakeholders.

The government instead needs to focus on introducing better tax laws, set up industrial zones in the country and give preference to the local industry because a vision limited to multinational functioning is bound to alienate the local business community and create a dip in local investment. At this point, the improvement we have seen in the economy so far has been due to rigorous loan taking measures along with bailouts.

Temporary fixes cannot revive an economy, a fact which we seen the government grappling within their series of mini-budgets. If a holistic vision is not adopted, it will also affect the social fabric of society.