The Covid-19 outbreak has rung alarm bells. The world is stuck in a whirlpool of new challenges posed by the epidemic. The World Health Organization has declared the Covid-19 outbreak a pandemic as it has engulfed more than 140 counties, including Iran and Pakistan.
Prudently, the governments of Sindh and Balochistan provinces in Pakistan have decided to close all private and government educational institutions. However, both governments have decided to extend the vacations for a month further since positive cases have been increasing, particularly in Sindh. Unfortunately, containing transmission of the coronavirus that causes Covid-19 is not the only problem. The pandemic is accompanied by a serious economic challenge too.
Iran has requested a US$5 billion bailout from the International Monetary Fund to cope with the outbreak. So far, developed countries have been sustaining the economic burden unleashed by the outbreak, but the pandemic will have effects on the global economy.
A review by Bloomberg finds that the outbreak could cost the global economy $2.7 trillion. Moreover, the report, published on March 6 on Bloomberg’s website, predicts that a blow to the Chinese economy will have ripple effects on weak economies such as Pakistan. For instance, China is the largest manufacturer of technological products. According to the report, if companies shut down in China, manufacturers will go extinct worldwide.
China has the largest share in imports (29%) in Pakistan. Surely, the closure of factories will affect the supply of manufactured goods in Pakistan. The recent scarcity of protective masks and sanitizers is a crystal-clear example of the correlative economic effect of a shrinking economy of China. Those products are imported from China.
Similarly, the waves of economic recession globally will impinge on the economy of Pakistan, particularly affecting the low-income class. The outbreak has proved a challenge on many fronts. It has forced the big economies to come forward with advanced technology to defeat the coronavirus. On the other hand, it has put the capacity of many countries to the test. Pakistan, indeed, falls in the category of countries the economic and health capacity of which might be weak in confronting this grave challenge.
Unfortunately, of Pakistan’s four provinces, Balochistan is closest to the threshold of vulnerability to the virus given its 900-kilometer-long border with Iran.
Moreover, Balochistan is reported to have run out of test kits for Covid-19. The provincial leadership lacks capacity to take decisive measures. Dangling between lack of leadership and economic constraints, Balochistan has to face its harsh economic situation too in the face of outbreak.
In comparison, Sindh’s economic condition has been sustaining the health burden effectively. Nevertheless, a sudden surge in Covid-19 cases would lead to isolation of patients in government hospitals. Isolating and properly caring for patients in government hospitals would be the testing time for the Sindh government too.
After completion of the quarantine period, the inflow of pilgrims from Iran might exacerbate the situation. Several new cases have been reported in Sukkur. All the new cases are pilgrims who have returned through the Taftan border crossing, where they had been quarantined.
Nevertheless, with prudent policies and measures, the coronavirus outbreak could be contained effectively. Comparatively Balochistan has a small population. The scattered population might create a concerning situation. However, the outbreak could be contained if it spreads in a small population in rural areas with a rapid lockdown. An outbreak in an urban area, specifically one of the cities adjacent to the Sindh border – Hub city could be a crucial city for importing the virus from Karachi – would intensify the spread.
Risks from the Covid-19 outbreak are high. However, turning minds toward the economic costs of the outbreak remains essential. The closure of educational institutions in Sindh and Balochistan is a legitimate step. But the situation demands more dedication and attention while keeping in view the issues of paid teachers employed in private educational institutions. They might stop paying temporary teachers, those who have been serving for one to six months. Such a decision would leave a huge chunk of teachers unpaid for months.
In the US, Congress has tabled a bill for giving relief to affected people. If the Republicans don’t veto the bill, it contains a clause that makes it mandatory for the federal government to disburse allowances to people who self-quarantine during the closure of institutions. It is high time for Pakistan’s central and provincial governments to make good on the political rhetoric of making the country a welfare state by backing unpaid workers through a social welfare fund. However, this could only be possible with a strong economy in hand.