Last couple of weeks evince the enormity of the corona pandemic across globe with Europe and Americas being worst hit. The corona has devastated the social and economic structure of the globe irrespective of developmental levels and social standings. Nonetheless, developed countries still are managing to mitigate the onslaught of this pandemic by ensuring minimum levels of living through social security’s setups.

Yet, the developing countries will suffer more owing to their bludgeoning populations and dilapidated health and social security situations. South Asia constitutes one-fourth of the world population and a majority of its countries are prone to become host of gruesome circumstances in case the corona pandemic hit them with the intensity it has infected the western world with. World Bank report presents an alarming economic outlook for the region in the midst of a crisis that could result in the worst economic performance of the last 40 years. According to the report, the regional growth could fall to anywhere in between 1.8pc and 2.8pc in 2020, a slide from 6.3pc projected six months ago. In a worst case scenario, a contraction in GDP of the countries is in offing. The Pakistan fledgling economy is trying to cope up with the pandemic, but the resources and conditions are not at that level that could sustain a minimum living for the labour class to survive. The total labor force in the country stood at 60-65 million and moderate estimates calculated by the Pakistan Institute of Development Economics (PIDE), an affiliate of the Planning Commission, showed that the lingering pandemic could result into unemployment ranging from 12 to 20 million. The PIDE has assessed that the monthly average losses of losing jobs stands at Rs180 billion to Rs260 billion, so in the worst-case scenario basis, the estimated losses could go up to Rs780 billion in the next three months. However, the government has decided to provide Rs-4000 monthly stipend to the possible job losers. The situation in the government`s revenue collection body is also not very encouraging as it is expected that FBR could lose a whopping 600 billion revenue shortfall during the fourth quarter (April-June) period of the current fiscal year.

On the trade side, the estimates are portraying a bleak picture where a sharp slowdown in imports of up to 60pc is expected with a decrease of 10% in exports. In case imports and exports plunged by 20% collectively, it would be tantamount to inflict 4.6% contraction of the GDP during the last quarter (April-June) of the current fiscal. This figure of 4.6% losses in GDP during the last quarter could be roughly quantified around Rs700 to Rs800 billion if the exchange rate in terms of the dollar versus rupee is estimated at Rs165 (that has already crossed the Rs167 mark in the open market) against the dollar. The aforementioned economic situation would translate itself into abject crises for the labour class if drastic step will not be taken to assuage their misery. First of all the disbursement of Rs 12000 stipend – which in fact is Rs 4000 per month shall be in line with the system as devised by the authorities over the power point presentation shown to the prime minister. It has been observed that innumerable complaints have started to surface with respect to the procedures involved. There are different levels of poverty that exists in Pakistan and similarly labour force can also be divided into different tiers. The Ehsaas program has been launched following the footprints of BISP, however the data required in the current program to a large extent are quite different from BISP. The BISP primarily focused on the families that don’t have any earning option and through BISP they had been given a sum of money to purchase basic food items, whereas the current challenge posed by corona is entirely different. Here we have to take care of those who had been rendered jobless during past 3-4 month. Therefore, to have the correct data is sine qua non for the government to purposely disburse the stipend. Failing to do so would end up this activity in a situation, where money would have been spent by the government and the needy would still be flooding the roads. The unskilled labor force working in different small to medium size industries is more at risk owing to lack of proper HSE (health safety and environment) processes at those setups. It is a government responsibility, that in case lockdown is eased out to accommodate the daily earners, the local administrations should keep an eye on these working places to ensure appropriate levels of social distancing and sanitization. This practice would help government to avoid getting this pandemic to slum dwellers where Corona God forbid could multiply at an exorbitant rate.

There is another aspect that needs an immediate attention of the government and that is returning back of the labour force from Saudi Arabia and the Gulf countries. This has two main outcomes of many possible ramifications, i.e. loss in remittances and a huge burden on the already fragile economy by adding into unemployment. The foreign remittances are like the very plasma for our economy with remittances from Saudi Arabia during the past 5 years have oscillated between $4.8 billion and $5.9 billion. Almost same value $3.1 billion to $4.1 billion was being added to the economy by the UAE. These earnings are generated by 2.6 million overseas Pakistanis in Saudi Arabia and 1.5 million in the UAE. Foreign investors have been likened to pigeons, they come one by one, but when they leave, they do so all at once. Pakistanis went overseas one by one, but if they will have to come back in the wake of this pandemic, they will come in clusters.

The government decision of slashing the interest rates, would offer a conducive opportunity to the local businessman amidst present economic crisis to start some economic activities, however, it is equally important that the burden of local business industry would be shared by the government by waiving off or deferring the utility expenses with clear directions that no worker shall be deprived of his or her job by the employer. A law should be introduced, that makes it mandatory for every employer to pay a basic salary to the labour force till the time businesses returns back to normalcy.

The writer is a corporate professional. He can be reached at chbilal1980@gmail.com