False Signals
By Anjum Altaf The Prime Minister has praised his economic team for an ‘economic turnaround’ that comprises declines in the current account and fiscal deficits and increases in foreign direct investments and remittances. Unfortunately, all these are misleading indicators but one in particular is especially egregious and contradictory. Why is the increase in remittances considered a part of the economic turnaround and something that governments consider an achievement worthy of praise? Consider an anguished airport conversation with a Pakistani working in Italy and supporting a wife and two children in Pakistan. He used to send the equivalent of Rs. 50,000 per month in lira for family support; now the equivalent of Rs. 80,000 is needed to sustain the same expenditures. The increase in remittances is an outcome of greater economic distress in Pakistan. It is a false signal reflecting economic failure, not success. Before patting themselves on the...