Pakistan: The Year 2020 in Review
By Riaz Haq
CA

The COVID19 pandemic has been the biggest story of 2020 in Pakistan and the rest of the world. It has complicated Pakistan's economic recovery as did the ever-present threat of political instability posed by the opposition parties trying to take advantage of the crisis.
Gallup Poll data shows that 65% of Pakistanis are happy despite hardships of the coronavirus pandemic. On the external front, Pakistan faced India's massive global disinformation campaign against it. The year 2020 was a tough year for Pakistan and the world with both health and economic challenges. Pakistan's second COVID wave is now subsiding, the factories are humming, the exports are rising, and the remittances from overseas Pakistanis are at an all-time high. The nation has shown its resilience yet again by dealing with both challenges successfully. Here's a quick rundown of the year 2020 in Pakistan:

COVID19 Pandemic
Pakistan has a very weak healthcare infrastructure. This situation raised serious questions about Pakistan's ability to effectively respond as the pandemic caused by the novel coronavirus hit the country in March 2020. While the crisis is not yet over, it appears that Pakistan has been spared the worst impact in terms of infections and deaths seen elsewhere in the world. World Health Organization has included Pakistan among the top six nations it has praised for effective handling of the pandemic. The key steps Pakistan took to contain the pandemic and soften its impact include:
1. Smart lockdown: Pakistan imposed targeted lockdowns in areas experiencing high rates of infections ratherthan a nationwide lockdown imposed by others, including Prime Minister Narendra Modi's government in neighboring India. This action helped bring down the virus transmission while protecting the livelihoods of millions of daily wage earners.
2. Testing and Hospital Surge Capacity: Pakistan ramped up testing capacity and rapidly converted expo centers and other large buildings to increase hospital beds availability with the help Pakistani military personnel. The government also procured a significant number of ventilators and large quantity of personal protective equipment (PPEs) for frontline health workers.
3. Direct Cash Transfers: Prime Minister Imran Khan's government handed out Rs 2,000 per family under the Ehsaas Emergency Cash Program to the poorest households.
4. Tree Planting Campaign: Pakistan government launched a program to plant hundreds of millions of trees as part of its reforestation campaign to deal with the effects of climate change.

Economic Recovery
1. Construction Sector: Cement sales soared 16.61% in the firstfive months (July-Nov 2020) of current fiscal year reaching an all-time high of 24 million tons. Pakistan is on track to become the world's sixth largest cement producer by 2030.
The government announced Naya Pakistan housing program which offers Rs 33 billion in direct subsidies for down payments for the first 100,000 applicants, according to media reports. In addition, the commercial banks are required to allocate 5% of their portfolio amounting to Rs330 billion for construction activities under this program. Pakistan’s mortgage finance to GDP ratio is just 0.25%, among the lowest in the world, according to the World Bank. A person earning Rs30,000 to Rs100,000 can build a house on a five-marla lot with the mortgage financing at 5% and that of 10-marla at 7%.
2. Large Scale Manufacturing: Large scale manufacturing continued its recovery with 5.46% growth in the first four months (July-Oct 2020) in spite of COVID19. Textile mills and garment factories reported to be operating near full capacity in November, 2020, indicating further growth in the LSM sector.
3. Exports: Pakistan's exports for the month of December 2020 grew by 18.3% to the highest-ever $2.357 billion mark, up from $1.993 billion in December 2019. The nation's exports are rising in spite of the COVID-19 pandemic, growing for the fourth consecutive month in December, 2020. In November, the exports rose to $2.161 billion, up 7.67% from $2.007 billion in the corresponding month last year, according to data released by Pakistan Bureau of Statistics. Exports grew in home textiles (20%), pharma (20%), rice (14%), surgical goods (11%), stockings and socks (41%), jerseys and pullovers (21%), women’s garments (11%)and men’s garments (4.3%).
Pakistan's technology export growth is continuing to accelerate with a 51% jump in November 2020 over the same month in 2019. The country's tech exports rose 39% in the first five months (July-Nov) of fiscal year 2021 over the same period last year. This came on top of a 21% increase in FY 2020 over FY 2019.
Pakistan exported $763 million worth of services related to telecommunications, computers and information technology during the July-November 2020 period. This represented a 39% increase over the same period in 2019. In November 2020, the country exported IT services amounting to $168 million, a 51% jump from tech exports November 2019.
4. Remittances: Pakistan saw a sharp increase of nearly 27% to $11.77 billion in remittances from its diaspora during the July-November period. This set a new record of over $2 billion in remittances for six consecutive months. Rising remittances have made up for Pakistan's continuing trade deficits. In fact, Pakistan has reported a current account surplus of $447 million in November, making it the fifth consecutive month of current account surpluses. In November 2019, Pakistan reported a deficit of $326 million. The current account surplus has reached $1.64 billion so far in the current fiscal year in July-Nov 2020. Pakistan reported a deficit of $1.74 billion for the same period last year.
5. Digital Economy: Pakistan's digital gig economy surged 69% during the COVID-19 pandemic, putting the country among the world's top four hottest online freelance markets, reported Payoneer, a global payments platform company based in Silicon Valley, in its latest report. Payoneer attributed this success to government programs such as Punjab government's e Rozgaar program that has been offering free online courses in digital freelancing. The sudden rush to learn skills online boosted the demand for instructors. The Pakistan government filled this demand by hiring alumni of programs like e Rozgaar who were successfully participating in the gig economy.
6. Soaring Food Prices: Global food prices are soaring by double digits amid the coronavirus pandemic, according to Bloomberg News. Bloomberg Agriculture Subindex, a measure of key farm goods futures contracts, is up almost 20% since June. It may in part be driven by speculators in the commodities markets. These rapid price rises are hitting the people in Pakistan and the rest of the world hard. In spite of these hikes, Pakistan remains among the least expensive places for food, according recent studies. It is important for Pakistan's federal and provincial governments to rise up to the challenge and relieve the pain inflicted on the average Pakistani consumer.

Political Opposition
1. PDM Narrative: It took Stephen Sackur, a BBC journalist, to challenge the Pakistani Opposition's anti-military narrative twice in the last two years. First, Sackur did it with Hameed Haroon, the CEO of Pakistan's Dawn Media Group. More recently, Sackur did it again with Opposition politician Ishaq Dar. Feverish spinning by pro-Opposition media spinmasters suggests that Sackur has done serious damage to the Pakistani Opposition's narrative about the Army and democracy in the country. By his aggressive questioning of Ishaq Dar, former Finance Minister and former Prime Minister Nawaz Sharif's close associate, Sackur has not only dismantled the Opposition parties' narrative but also clearly established that former Prime Minister Nawaz Sharif is a convicted criminal and a hypocrite.
2. NajamSethi's Analysis: Prominent Pakistani journalist and political analyst NajamSethi, a strong critic of Prime Minister Imran Khan, sees desperation among the Pakistani Democratic Movement (PDM) leaders. In a recent interview with well-known journalists Raza Rumi and MurtazaSolangi on NayaDaur social media channel, Sethi said the Pakistani opposition, particularly PML-N, believes it is "now or never" for them.
NajamSethi added that if the Pakistan Tehreek-e-Insaf government led by Prime Minister Khan survives the current five-year term and succeeds in stabilizing the nation's economy, the ruling party will be re-elected for another five-year term in 2023 with the support of what Sethi calls "Miltablishment" (a euphemism for Pakistani military). This, Sethi said, would mean that the PML-N would break up and lose its relevance. Sethi acknowledges there is genuine support for PTI in spite of Imran Khan government's failures in the first two years. This support is particularly strong among the youthful voters who are willing to forgive PTI's poor handling of the economy.

Modi's Anti-Pakistan Campaign
1. Disinformation Campaign: EU Disinfo Lab, an NGO that specializes in disinformation campaigns, has found that India is carrying out a massive 15-year-long disinformation campaign to hurt Pakistan. The key objective of the Indian campaign, as reported in "Indian Chronicles," is as follows: "The creation of fake media in Brussels, Geneva and across the world and/or the repackaging and dissemination via ANI and obscure local media networks – at least in 97 countries – to multiply the repetition of online negative content about countries in conflict with India, in particular Pakistan". After the disclosure of India's anti-Pakistan propaganda campaign, Washington-based US analyst Michael Kugelman tweeted: "The scale and duration of the EU/UN-centered Indian disinformation campaign exposed by @DisinfoEU is staggering. Imagine how the world would be reacting if this were, say, a Russian or Chinese operation".
2. Pakistan Dossier: Dr,.Moeed Yusuf, Prime Minister Imran Khan's National Security Advisor, has said that "we have evidence"of India's links to several terrorist attacks in Pakistan. In an interview with Indian journalist Karan Thapar, Dr Yusuf mentioned specific terrorist incidents with Indian intelligence agency's fingerprints on them. Specifically, he mentioned terrorist attacks on the Army Public School in Peshawar that killed 149 people including 132 schoolchildren. “Malik Faridoon who masterminded the attack from Jalalabad (in Afghanistan) was in touch with handlers at the Indian Consulate as children were massacred in broad daylight,” he said. Yusuf also mentioned India's links to terrorist attacks on the Chinese Consulate, Pakistan Stock Exchange and Gwadar 5-star hotel. KulbhushanJadhav "has been caught with his pants down." India recently spent $1 million to bring about TTP, 4 other militant organizations' merger in Afghanistan. Kashmiris should be made third party in any India-Pakistan talks.

Pakistan Defense
Pakistan military launched its first Defense AI Program for a Cognitive Electronic Warfare (CEW) at its Center for Artificial Intelligence and Computing (CENTAIC), according to media reports. Modern connected weapon systems generate vast amounts of data requiring artificial intelligence and machine learning software for speedy analysis and rapid decision-making on the battlefield. Modern electronic warfare requires the use of artificial intelligence and machine learning (AI/ML) to analyze vast amounts of data coming from a large number of sensors mounted on various military platforms deployed on the ground, in the air, and on the seas. EW systems can collect a considerable amount of data about an enemy’s frequency use, radar deployment, and many other factors.

Happiness Survey
Gallup "End of the Year 2020" Survey reported that 65% Pakistanis say they are happy in spite of the COVID-19 pandemic. This is well above the 54% reported happy in a global happiness survey. Among 41 countries surveyed by Gallup International, Pakistan ranks 4th on the Happiness Index, 17th on the Hope Index and 6th on the Economic Optimism Index.