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The fall in the value of Pakistan's rupee against the dollar in the past fortnight just when the new government insists that the economy faces an unpleasant future should come as no surprise to anyone. It is clear that the pressure on the rupee comes from hard economic realities such as a yawning international trade deficit, driven up by fast rising values of imported oil and to some extent commodities as well.
The ultimate question must be exactly to what extent are these trends driven by economic parameters and where do other considerations kick in. The new government's immediate push to denounce the entirety of the track record under former prime minister Shaukat Aziz, must all be laid to blame. The pressure on the rupee in the recent past may well have been at least partially responsible for the growing uncertainty.
At a time when Pakistan's economic outlook is already under stress, irresponsible remarks on the part of individuals like Ishaq Dar, the new finance minister, speaking of doom and gloom under his preceding government, hold out no new hopes. Of equal significance is the failure of the new government to settle down politically, with former prime minister Nawaz Sharif - president of the Pakistan Muslim League-Nawaz - continuing to insist upon restoring former chief justice Iftikhar Mohammad Chaudhary.
Such a political approach must only add to the prevailing uncertainty faced by Pakistan today. In sharp contrast to Sharif's remarks, the position taken by Asif Ali Zardari - co-chairman of the Pakistan People's Party (PPP) - makes a lot more sense. In remarks on a TV channel this week, Zardari was quick to remind his interviewer that the mandate given to the new government by the Pakistani public was essentially to deal with everyday economic challenges rather than primarily for restoring the judges.
Zardari indeed has a very valid point. Ultimately for ordinary people, the overriding issue must be the future prospect for the economy rather than issues of democracy. There are more examples in the last century of acute bread and butter issues leading to abrupt political change, rather than matters of ideology alone. The other part of tackling the bread and butter issues as a first priority must have much to do with consolidating the benefits of Pakistan's improving economic growth from recent years.
While Pakistan has received a major lift to its economy due to rising growth, the country needs to do more to overcome gaps such as relying largely on the support from its western donors notably the United States, which have stepped up their aid to Pakistan in the aftermath of events following the New York terrorist attacks.
Foreign equity fund managers and foreign direct investors have also become increasingly active, investing more than $8 billion during the last financial year (July 2006-June 2007), up from almost half of that amount during the year before. The rise in foreign investment came more from Pakistan's successful undertaking of policies such as speeding up its privatisation programme and expediting the flow of investments through other policy mechanisms.
Building up on that success must see the new government begin dealing with a widening gap between the rich and the poor - a challenge which is best met through a number of robust and key reforms on the one hand, and lifting the quality of lives of its people on the other. Without success in overseeing such a turnaround in the future of Pakistan, it is practically impossible to imagine a major lift to the country's prospects in the coming times.
The writer is a journalist based in Pakistan.
Ultimately for ordinary people, the overriding issue must be the future prospect for the economy rather than issues of democracy.
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