Abdul Basit Alvi
Economic crises have the potential to disrupt any nation’s financial stability at any given moment, posing a significant threat to the well-being of its citizens. In such dire circumstances, a country’s military can emerge as a pivotal force in aiding civilian authorities to navigate through these challenges. While the primary mission of an army is to safeguard national security, it can also serve as a valuable asset in addressing economic crises. One of the most immediate and conspicuous ways through which the military can assist a civilian government during an economic crisis is by providing relief and humanitarian aid in times of calamities such as earthquakes, floods, or pandemics. The military can swiftly mobilize to extend help to affected areas, encompassing activities such as search and rescue operations, medical assistance, food distribution, and shelter provision. By shouldering the responsibility of managing disaster relief efforts, the military relieves the civilian government of this burden, allowing it to concentrate its limited resources on tackling the ongoing financial crisis. Furthermore, the military’s well-structured organization and discipline ensure an efficient and coordinated response, guaranteeing that aid reaches the affected populations promptly. Investing in infrastructure development stands as a critical strategy for overcoming an economic crisis. The military boasts a proficient and skilled engineering corps capable of contributing to infrastructure projects. They can participate in the construction, repair, and maintenance of crucial infrastructure elements like roads, bridges, and public facilities. This not only generates employment opportunities and stimulates economic activity but also contributes to enhancing the long-term economic resilience of the nation. Economic crises often give rise to social unrest and a surge in crime rates. The military plays an essential role in upholding security and stability during such tumultuous times. Their presence acts as a deterrent to criminal activities, ensuring that businesses can operate without the fear of theft or vandalism. By preserving law and order, the military bolsters economic recovery and encourages investments, both of which are vital for navigating through an economic crisis successfully. In certain instances, the military can lend its expertise to assist in managing the country’s budget during an economic crisis. They can offer financial insights to help the civilian government make strategic decisions, prioritize spending, and allocate resources more efficiently. This collaboration can culminate in a more sustainable plan for economic recovery. Preserving national security constitutes a fundamental duty of the military. During periods of financial turmoil, a robust defense capability can act as a deterrent against external threats, safeguarding the nation’s sovereignty and assets. Moreover, the military can be deployed to engage in diplomatic negotiations with international partners to secure aid and financial assistance. It is often said that prevention is preferable to cure, and the military can aid civilian governments in preemptively preparing for potential financial crises. They can craft contingency plans and strategies for mitigating the impact of economic shocks. These plans encompass economic, security, and humanitarian responses, enhancing the nation’s readiness to confront future crises. The Pakistan Army has consistently provided assistance to the country and nation whenever it has been required. Across history, numerous countries have grappled with financial crises that posed a threat to their economies and stability. In many of these instances, the military has assumed a pivotal role in aiding civilian authorities in navigating these challenging circumstances. During the Egyptian Revolution of 2011 and the ensuing economic difficulties, the Egyptian military assumed a critical role in stabilizing the nation. They intervened to uphold security and stability, effectively bridging the divide between the government and the populace. Additionally, they engaged in economic activities, such as food production, which alleviated the strain on the national economy. In 2001, Turkey encountered a substantial financial crisis. The Turkish military, often seen as a guardian of the nation’s secular values, played a part in advocating for economic reforms. While they did not directly assume control of the government, their influence helped steer the country toward adopting prudent fiscal and monetary policies, ultimately contributing to the nation’s economic recovery. Zimbabwe grappled with severe hyperinflation in the late 2000s, wreaking havoc on its economy. The military, a significant player in the nation’s political landscape, played a role in preserving stability during these tumultuous times. In the wake of the 1997 Asian financial crisis, Indonesia’s military was summoned to aid in disaster relief efforts and the maintenance of law and order. Their presence helped quell social unrest and secure the nation, allowing the civilian government to concentrate on economic recovery measures. In Brazil, the military has historically been called upon to assist in economic management. During a period of hyperinflation in the 1980s, they played a vital role in supporting the transition of the civilian government toward a more stable economic system. India has confronted financial crises, occasionally calling upon the military for disaster relief, humanitarian aid, and infrastructure development during these periods. Their efficiency and discipline have proven valuable in crisis management. Thailand experienced political and financial instability in the early 2000s, and the military intervened at times to uphold law and order. Their presence contributed to stabilizing the situation, facilitating economic recovery. In the aftermath of the 1997 Asian financial crisis, the South Korean military engaged in disaster relief and infrastructure development, significantly boosting the nation’s recovery efforts. These instances exemplify that during financial crises, the military can offer crucial support to civilian governments. While the extent of their involvement differs from country to country and situation to situation, they frequently contribute to disaster relief, the maintenance of security and stability, participation in infrastructure development, and provide essential expertise in managing financial challenges. Pakistan has witnessed several military regimes since its inception in 1947. Although military rule is often associated with political instability, it’s essential to examine some of the significant developments that unfolded during these periods. Military administrations in Pakistan have, on occasion, brought about substantial changes in various domains, encompassing economic policy, infrastructure development, and international relations. Military regimes in Pakistan have frequently introduced economic reforms as a response to the country’s financial challenges. A noteworthy illustration is General Ayub Khan’s tenure from 1958 to 1969. During his leadership, the regime implemented the “Basic Democracies” system, designed to decentralize political power. Ayub Khan’s administration also instigated the “Green Revolution” to enhance agricultural production, leading to improved food security and economic growth. Another prominent example is General Pervez Musharraf’s regime in the early 2000s, which kick-started economic reforms. His government embraced policies that liberalized various economic sectors, privatized state-owned enterprises, and attracted foreign investments. These reforms fostered a period of economic growth and bolstered foreign exchange reserves. Military regimes have consistently emphasized infrastructure development, recognizing the importance of modernizing the nation’s transportation, energy, and telecommunications networks. General Ayub Khan’s regime initiated the Indus Basin Treaty with India in 1960, resulting in the construction of major infrastructure projects such as the Mangla Dam and Tarbela Dam, which significantly contributed to Pakistan’s agriculture and electricity generation. General Musharraf’s era witnessed substantial infrastructure development, including the construction of new highways, expansion of the telecommunications sector, and the modernization of transportation and energy infrastructure, all aimed at enhancing the quality of life and stimulating economic growth. Military regimes have also dedicated efforts to improving education and healthcare in Pakistan. General Zia-ul-Haq’s regime, notwithstanding its political and social conservatism, invested in the expansion of religious education and established numerous educational institutions. Similarly, General Musharraf’s regime concentrated on enhancing education and healthcare to ameliorate human development indicators and alleviate poverty. The military administrations in Pakistan have exerted a significant influence on the country’s foreign relations. General Zia-ul-Haq’s regime, for instance, fortified Pakistan’s ties with the United States during the Soviet-Afghan War in the 1980s. This strategic alliance had implications for both the military and the economy, with enduring geopolitical repercussions. General Musharraf’s administration aligned Pakistan with the United States after the September 11 attacks in 2001, supporting the U.S. in its “war on terror.” This decision had multifaceted consequences, resulting in increased financial aid to Pakistan. The Pakistan Army possesses a distinctive advantage within the political framework, wherein all segments of society are represented, unlike the political system that predominantly allows a specific class to ascend to power and govern the nation. The merit-based culture within the Pakistan Army promotes equal opportunities for individuals to assume key positions, fostering a heightened awareness of public issues among its members. Pakistan has confronted recurring financial crises and economic challenges over the course of its history. These crises have exerted substantial influence on the nation’s economy, governance, and social stability. To fathom the underlying causes of these persistent financial crises, one must grapple with a complex array of factors. One of the foundational factors contributing to financial crises in Pakistan has been economic mismanagement. Irresponsible fiscal policies, excessive government borrowing, and budget deficits have been recurring problems. A lack of fiscal discipline, coupled with inefficient tax collection and inadequate revenue generation, has frequently resulted in unsustainable debt burdens. The nation’s political instability and frequent governmental changes have introduced a destabilizing influence on Pakistan’s economy. Governments have struggled to maintain consistency in their economic policies, creating uncertainty for investors and foreign partners. Political disputes and a lack of consensus on critical economic matters have further hindered stability. Corruption has remained a persistent concern in Pakistan, exacting a detrimental toll on the economy. It has dissuaded foreign investment, obstructed the efficient utilization of resources, and caused the misallocation of funds. A dearth of transparency and accountability has exacerbated this issue. External factors, including fluctuations in global oil prices, international economic conditions, and geopolitical events, have routinely contributed to Pakistan’s financial instability. The nation’s reliance on imports and external assistance has made it susceptible to external shocks. Pakistan’s ongoing security challenges, particularly those linked to terrorism and regional instability, have imposed significant economic costs. Balance of payments difficulties have often plagued Pakistan, largely attributable to a persistent current account deficit. The trade imbalance and a heavy reliance on remittances have made the country vulnerable to external shocks and fluctuations in foreign exchange reserves. A prolonged energy crisis characterized by frequent power outages and a shortage of electricity has hindered industrial production and economic growth. This energy deficit has escalated production costs and eroded the nation’s competitiveness in the global market. The rapid growth of Pakistan’s population presents a unique challenge. The country’s capacity to create sufficient employment opportunities to accommodate the expanding workforce has been limited, resulting in elevated levels of unemployment and underemployment, particularly among the youth. Inefficient and corrupt government institutions have obstructed the implementation of vital reforms and policies. The absence of robust regulatory bodies, coupled with an ineffective legal system, has impeded economic development and discouraged potential investors. Inflation is a chronic economic challenge encountered by nations worldwide, Pakistan included. While moderate inflation is a normal facet of a robust economy, excessive or hyperinflation can have grave repercussions on the purchasing power of citizens, precipitating economic instability. There are several underlying factors contributing to the elevated inflation rates in Pakistan. One of the principal instigators of inflation in Pakistan resides in the monetary policy dictated by the nation’s central bank, the State Bank of Pakistan (SBP). When the SBP embarks on expansionary monetary policies, such as reducing interest rates or augmenting the money supply, it can trigger an upsurge in the currency circulating within the economy. This heightened currency circulation can elevate the demand for goods and services, resulting in price escalations. Fiscal policies instituted by the government can also wield a substantial influence on inflation. Elevated budget deficits and heightened government borrowing can give rise to amplified public spending. This augmented demand for goods and services can exert upward pressure on prices, consequently leading to inflation. The exchange rate between the Pakistani Rupee (PKR) and foreign currencies can impact inflation. A depreciating rupee can elevate import costs, thereby contributing to inflation. Given Pakistan’s reliance on imported commodities, spanning energy, machinery, and raw materials, it is susceptible to currency fluctuations. Disruptions in the supply chain, be it due to natural calamities, political instability, or logistical issues, can perturb the availability and cost of goods. Such disruptions can engender supply shortages, resulting in elevated prices for essential goods. Pakistan’s economy places a high premium on energy resources, and fluctuations in energy prices, especially oil, possess a direct influence on production and transportation costs. An increase in energy prices can catalyze price hikes across various goods and services. Pakistan stands as a net importer of numerous commodities, including food, petroleum, and metals. Shifts in global commodity prices, driven by international market dynamics, can directly sway the cost of imported goods, thereby propelling domestic inflation. The rapid population growth in Pakistan represents a distinctive challenge. The nation’s capacity to generate jobs and resources to accommodate this burgeoning population is limited, contributing to underemployment and poverty. The population pressure can incite greater demand for goods and services, resulting in price surges. Structural shortcomings within the economy, such as inadequate infrastructure, inefficient production processes, and low agricultural productivity, impede the supply side of the economy. When the supply fails to keep pace with escalating demand, it culminates in price hikes and inflation. Pakistan’s vulnerability to external shocks, spanning natural calamities, political strife, and geopolitical events, can disrupt economic activities and contribute to inflation. These occurrences can impact agricultural production, energy supplies, and overall economic stability. It is on record that the economic situation has been so worse during previous political governments that it was said that Pakistan is going to be default. Lately, Pakistan has witnessed notable developments in its economic sector, delivering a welcome relief to individuals grappling with inflation. The government’s recent announcement of substantial reductions in petroleum product prices has been met with enthusiasm. According to the official notification from the Ministry of Finance, the cost of petrol per liter has undergone a significant decrease of 40 rupees, resulting in a new price of 283 rupees and 38 paise per liter. Similarly, the price of high-speed diesel has experienced a reduction of 15 rupees per liter, bringing it down to 303 rupees and 18 paise per liter, while the price of kerosene has been trimmed by 22 rupees and 43 paise per liter, with the new price reaching 214 rupees and 85 paise per liter. It’s worth recalling that on September 30, petrol prices were lowered by 8 rupees per liter, and diesel prices saw a reduction of 11 rupees per liter. The Ministry of Finance has attributed this decrease in petroleum product prices to the appreciating value of the Pakistani rupee against the US dollar and the decline in global crude oil prices. The continuous depreciation of the dollar’s value is noteworthy. At the commencement of this business week, the American currency witnessed a decrease of 79 paisa in the interbank market, concluding at 276 rupees and 83 paisa in the interbank market. It’s worth mentioning that the dollar’s price has swiftly descended from its record high of over 332 rupees. Today, one month after these measures, positive news has started to be received regarding the economy, the crackdown against illegal dollar trade, smuggling, betting, administrative measures and reforms by the State Bank have brought positive results. In the month of September, it outperformed the currencies of the world. According to the report of the international organization, the Pakistani currency has improved by 6.2% against the dollar in a month. In September, the Pakistani rupee became the world’s number one currency today, the situation is that there is no buyer for dollars in the market, whereas a month ago, dollars were not available in the market. Furthermore, due to declining gold prices in the global market and stringent measures taken within the country, gold prices in Pakistan have also seen a dip. At the outset of this week, the price of gold per ounce in the international market diminished by 15 dollars to reach 1923 dollars. Simultaneously, in Pakistan, the price of gold per tola decreased by 1900 rupees, and the price of gold per 10 grams dropped by 1629 rupees. Consequently, the local exchange markets witnessed a per tola gold price of 2 lakh 100 rupees and a per 10-gram gold price of 1 lakh 71,553 rupees. The Pakistan stock market has displayed a consistent positive trajectory, benefiting investors significantly. On the first day of the business week, the stock market observed favorable business trends, with the 100 index concluding at 49,731 points, marking an increase of 238 points by the close of the trading day. It’s noteworthy that, at the conclusion of the previous business week, the 100 index stood at 49,493 points. In the course of the trading day, the stock market witnessed transactions involving 29 crore, 63 lakh, 40 thousand, 716 shares, with a total worth of 10 billion 59 crore, 77 lakh, 76 thousand, 148 rupees. These positive developments have been brought about by the decisive actions taken by Army Chief General Asim Munir and the Pakistani Army, which have provided substantial practical support to the government in overcoming the financial crises. The Pakistan Army has taken concrete measures to combat sugar and dollar smuggling, the prevention of which is considered a catalyst for economic recovery. The Army Chief has demonstrated a strong commitment to curbing smuggling activities by tightening border security, and the anti-smuggling operations have played a pivotal role in these recent improvements. General Asim Munir is actively promoting foreign direct investment through the Special Investment Facilitation Council (SIFC), which is poised to have a transformative impact on the country’s development and progress. Investments in the productive sectors of the economy, particularly industrial manufacturing, will be crucial for growth. Thanks to the personal interests and efforts of the Army Chief, friendly countries have expressed their readiness to make substantial investments in Pakistan. Moreover, meaningful reform necessitates the facilitation of small businesses and the empowerment of entrepreneurs, not solely focusing on foreign investors. Substantial efforts to ensure political stability are also pivotal contributors to our economic recovery. The ongoing battle against terrorism and the zero-tolerance stance against anti-state elements represent key factors behind these remarkable developments. With the reduction in petroleum product prices, government agencies are now set to address the issue of inflation. The government has announced significant reductions in petroleum product prices and directed relevant authorities to establish a price control mechanism. Furthermore, all provincial governments have been instructed to reduce the prices of essential commodities. The government is committed to taking measures that will ensure the benefits of reduced petroleum product prices are effectively transferred to the people and that this policy is rigorously enforced. Readers, it’s important to note that the driving force behind these recent developments is Army Chief General Asim Munir. Personally, I am aware that he does not hail from an upper or elite class background, as his father served as the principal of a school in Rawalpindi where my father was a teacher. General Asim Munir is a self-made and down-to-earth personality from a middle-class family, and his understanding of the common people’s issues is invaluable. Having such a leader at the helm of Pakistan’s armed forces is a positive sign, and the recent developments and signs of rapid economic revival reflect the Army Chief and the Pakistan Army’s deep commitment to the country. The nation is grateful to Army Chief General Asim Munir and the Pakistani Army for their efforts to heal the nation’s wounds and take concrete steps to improve the economy.
