If the purpose of a press conference is to share relevant and material information with the press and answer their questions, then both the press and government do a terribly poor job at the launch of Economic Survey in Pakistan every year.
Quite frankly it’s a fish market out there. Instead of sharing the survey with the press at least a few hours before the conference to ensure a meaningful engagement, the survey is released mid-way into the conference after which all hell breaks loose. Every time! Journalists rush, leap nay elbow-out their colleagues to get their copies as if it’s the last bottle of water in the Sahara. Take it easy folks!
And the questions? Hardly any on the actual survey or the data that is fed into the production of the survey. Yesterday was no exception. Nearly all of the questions were well left by the minister because they pertained to budget or the IMF or they were policy related. There was only one reporter who had the wisdom to allude to the reliability of statistics, and question the statistics division itself. She was shrugged off by the finance minister.
Recall that statistics has now been placed under the planning ministry, which is as bad as being placed under the finance ministry. Like finance, P-block is also a user of data. Does it make sense for the user of data to be the producer of data as well? Those are the kind of questions that need to be raised at a press conference relating to Economic Survey. (See BR Research’s ‘Behind the scenes of CPI blooper’ & ‘Free the statistics division’, published on November 9, 2018 and May 2, 2019)
Anyhow, one of the many pressing facts that emerge out of the survey is the contraction in crops and large-scale manufacturing GDP. The latter – tracked by the LSM index - as we know has been in what economists technically call a recession; FY19 saw LSM index contract in two consecutive quarters. But while there will be a lot of hue and cry and lobbying henceforth to lift manufacturing sector, the farming sector remains at the risk of being ignored.
Thanks to the urban bias that dominates both media discussions and public policies, Pakistan’s farming GDP has been consistently growing slow in each consecutive decade since the 60s. Its share in national economic output has lately been the lowest in recent years. Its share in employment, however, still up there at 38.5 percent according to FY19 Economic Survey; services and manufacturing sector share in employment being 37.6 and 23.8 percent respectively.
Those who think farming is a thing of past, think again. According to Dr. Hafiz Pasha’s analysis, almost 59 percent of the manufacturing in Pakistan is agro-based, 15 percent of banking and insurance is pegged to farming, 53 percent of trading margin is linked to performance in agriculture, and so is 48 percent of volume of transport. The sector also contributes about a tenth of the country’s export earnings: cotton, rice, leather etcetera. Leaving this sector behind is neither good for the people (in terms of income or SDG inequality); nor good for macroeconomic growth.
Yet with all the good intentions that may or may not exist, there is no guarantee that farming growth will find miracle in the ensuing years. ‘Package-based’ economic management doesn’t work for manufacturing sector; nor will it work for farming. Farming is a far more complicated affair considering that it is a subject to devolved provinces and suffers from a myriad of long-term structural problems such as inefficient water usage, low yields, poor quality of seeds and pesticides, lack of financing and insurance, warehousing and transportation, and the whole nine yards.
Oddly enough, no one even talks about statistical irregularities. For instance, livestock sector that has about 55 percent share in agriculture GDP happily grows at a seemingly flat pace. The reason: the statistics department simply assumes that livestock growth rate between the last two livestock census (1996 and 2006) holds truth today as well. Well that is a piece of fiction.
The 2016 livestock census by Punjab, which has the biggest cattle size in Pakistan, shows that livestock in that province has actually dwindled due to a host of factors that will be covered by BR Research later this week. While a likely decline in livestock GDP (if GDP measurement is improved) may be offset by a better measure of manufacturing economy, we would never know until the long pending surveys and census (including population) are completed and the statistical department made autonomous and robust. Yesterday’s press conference was a lost opportunity to discuss these kinds of pressing facts and fiction.
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