ADAM Smith was a Scottish economist and philosopher also known as the ‘Father of Economics’. His book, An Inquiry into the Nature and Causes of the Wealth of Nations, first explained the concept of the ‘invisible hand’. This the man did way back in 1776.

When someone takes an action driven by self interest, there are social factors that benefit the government and society in terms of the tax that it generates for the government and the income distribution by way of job creation in the free market. This, according to Smith, is known as the invisible hand, and it is beneficial for the development of a country. This model of development is indispensable to curtail imports and to increment exports. This invisible hand seems to be staying away from Pakistan’s economy.

If we consider the current national economy, the situation is critical. The US dollar is soaring like never before, and the delay in the release of funds by the International Monetary Fund (IMF) is a threat that is getting more and more serious by the day.

The previous government had frozen the electricity tariff and fuel prices under a relief package for the people. This was against the commitments made to the IMF, which is now demanding it to be reverted. This action will definitely affect the common man, especially the salaried class.

One way out of the tight spot is for the Ministry of Agriculture to be fair to the farmers in order to produce more. This means subsidies on agricultural implements. Also, the produce should not be allowed to be exported or smuggled.

The sitting government needs to formulate economic policies that will not only take care of the deficit, but also stabilise the country’s economy. The government must realise that time is running out, and our options to attract foreign direct investment, promote industrialisation and develop economic zones are getting fewer and fewer.

Taha Soomro
Karachi

Published in Dawn, May 18th, 2022