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Pakistan needs ‘developing youth skills’

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Pakistan has witnessed further decline in Foreign Direct Investment (FDI) at a time when the country is going through an extreme financial crisis. The country recorded a huge decline in FDI which has pushed the already ailing economy of the impoverished country to the brink of collapse.

The investment has dropped by 52% in the first four months of the current financial year. FDI between July and October has decreased from $726 million to $348 million and the largest investment in Pakistan during the current financial year has come from China which amounted to about $74.8 million.

The State Bank of Pakistan has expressed concern over the decline in FDI, lamenting the country is moving towards becoming a bankrupt state. It fears the situation could be dire in case FDI declines further.

The UAE had invested $67.6 million this time last fiscal year, but in the current financial year, it has decreased to $51.4 million according to data provided by the State Bank of Pakistan.

Delay in reforms pushing Pakistan toward default  

Without doubt, Pakistan’s economy will have a little chance to improve sans addressing structural distortions as these distortions are present across all aspects of economic policies to start from taxes to subsidies, from trade restriction to gender norms and etc….

Pakistan’s textiles exports have also dropped to their 17-month low since May 2021 due to a global economic slowdown in the textile and clothing demand in the US, UK and Europe. No matter whatever was the reason, whether price inflation, growing energy expenditure and surging credit costs in the West, it was a disappointing export scenario for Pakistan. Last year, Pakistan export earnings were at $19.35 billion, a historic high, but this year it may decline by $3 billion.

Islamabad is facing an unprecedented foreign exchange crisis, highlighting the fragility of the country’s economic situation.

But Pakistan’s Minister for Planning, Development and Reforms, Ahsan Iqbal said that there is no possibility of bankruptcy in the current state of Pakistan’s economy. Accepting economic problems, he said that efforts are being made to settle it quickly.

Challenging road ahead  

Marred by political uncertainty and challenging economic indicators, Pakistan’s GDP growth is projected to witness a significant slowdown to 2.1% in the ongoing fiscal year.

In its latest report, the Egyptian financial services company forecast Pakistan’s real GDP growth will slow to 2.1% in FY, from 6.2% in the previous fiscal year with the potential for a mild recovery in FY24 to 3.1%.

According to the report, Pakistan’s macro outlook remains hostage to political instability that has unfolded since early this year after the impeachment of former Prime Minister Imran Khan.

Iqbal also blamed Khan and his political party Pakistan Tehreek-e Insaf (PTI) for spreading false propaganda on the country’s economic conditions. Khan is responsible for this financial crisis in Pakistan, according to Iqbal, who claimed that Shehbaz Sharif government will be able to come out of this situation.

Beside the political environment that has become a deadlock with a cornered ruling coalition facing an increasingly popular opposition, leading to a political stalemate, the recent floods also paint an unfavorable economic outlook with the loss of billions of dollars in infrastructures.

Moreover, supply disruptions on the food side, mainly due to the recent floods, and potential measures to contain the fiscal deficit are likely to keep inflation elevated, according to Egyptian report, as it also projected average inflation of 23.5% in FY23

Pakistan eyes boosting trade ties with Turkey

Pakistan Prime Minister Shehbaz Sharif is looking to boost trade and investment ties with Turkey as both the countries are going to celebrate the 75th anniversary of the establishment of diplomatic ties this year.

“The deep-rooted brotherly relations between Pakistan and Turkey will be further consolidated through strengthening trade and investment ties,” Sharif said, in his address at the Turkey-Pakistan Business Council organized by the Turkish Foreign Economic Relations Board (DEIK) in Istanbul.

Praising the contribution of DEIK in boosting commercial ties between the two nations, he voiced his government’s “strong commitment” to providing opportunities to businessmen from both sides to further develop mutually beneficial linkages.

Sharif said that the Trade in Goods Agreement (TGA) signed in August, during the Turkish trade minister’s visit to Pakistan will contribute to achieving higher trade volumes commensurate with the true potential existing between the two sides.

During one-on-one meetings with Turkey’s leading business people on the sideline of the meeting, he urged the businessmen to invest in Pakistan, particularly in the evolving energy sector, such as renewable, and assured complete support of Pakistan’s government.

Pakistan has all the potentiality for economic recovery

Given all the difficulties, it doesn’t mean Pakistan has no road toward economy stability and for this the country needs to reduce income, gender, regional inequalities through progressive taxation and pro-poor public expenditures, greater participation of women in the labor force as well as special attention to less advanced regions. Islamabad also needs to expand vocational and technical training and robust social safety nets.

Pakistan is a young nation in terms of population and for the next 50 years at least, Pakistan will have a relatively young populace while the advanced countries are aging. The authorities must use this potentiality and equip these young men and women with the skill sets required by labor-deficient countries.

Japan wants 80,000 ICT professionals until 2030, while Korea has also opened its doors to foreign workers, and similarly, the immigration policies of Canada, Australia, New Zealand have been altered in favor of technical and skilled manpower. This is indeed a great chance for the Pakistanis to meet this growing demand which at the end of the day this process will introduce and produce good professionals to the country.

The young generation can also emerge in technologies and their applications to industry, agriculture, education, health, finance, and other sectors or remain part of Technology laggards.

Pakistan’s economy continues to be in shambles and it is widely feared that Pakistan is on the verge of imminent default, and since the start of 2022, Pakistan has faced a series of balance of payments crises. Meanwhile, the devastating floods had taken up whatever was left of the poor population. Time has come for the Pakistani policymakers to halt politicking and solve the protracted economic problems through the workforce of its young and energetic generations.

 

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Chinese, Russian troops hold joint exercise targeting cross-border terrorism

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China and Russia have held a joint military exercise focusing on cross-border terrorism, amid growing concern over terrorist attacks in Moscow.

The drill was held on 25 June in a river area near the Heilongjiang Bridge linking Russia’s Blagoveshchensk and China’s Heihe, the Chinese military’s official media outlet PLA Daily reported on Tuesday.

It was the first joint counter-terrorism drill between the neighbouring countries since Russia’s intervention in Ukraine.

It came just days after terrorist attacks in Russia’s southern region of Dagestan on 23 June, in which at least 22 people were killed in shootings at two synagogues, two Orthodox churches and a police station.

In March, more than 140 people were killed in an attack on a concert hall in Moscow, the deadliest terrorist attack in Russia for almost two decades. The Khorosan branch of ISIS claimed responsibility for the attack.

According to the PLA Daily, last week’s joint exercise simulated ‘terrorists trying to cross the border’ to launch an attack.

Chinese and Russian troops used aerial reconnaissance, maritime interception and land ambush to intercept and capture the terrorists during the exercise.

The exercise, which focused on improving intelligence sharing and operational coordination, showed the “firm determination” of both militaries to take effective measures to “combat all forms of terrorism, separatism and extremism” while jointly securing border areas, the report said.

The report also said that the two sides discussed further deepening border cooperation.

This is not the first time the two countries have held joint counter-terrorism exercises. In 2019, China’s People’s Armed Police took part in an exercise with the Russian National Guard in Russia.

According to Tass, Russian Foreign Minister Sergei Lavrov reaffirmed the two countries’ ongoing cooperation in the fight against terrorism, including on multilateral platforms, during a meeting with his Chinese counterpart Wang Yi in April.

Aiming to strengthen law enforcement cooperation

Last week’s joint exercise follows an agreement between Chinese and Russian leaders during Russian President Vladimir Putin’s visit to Beijing in May to strengthen cooperation in law enforcement and defence, including by expanding joint training and exercises.

The Chinese and Russian coast guards also signed a memorandum of understanding on maritime law enforcement cooperation in April last year.

In March, China and Russia organised a naval exercise with Iran focusing on anti-piracy efforts. China and Russia also held joint naval and air exercises in the Sea of Japan, or East Sea, in July last year.

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Controversial military operations and ethnic dynamics in Pakistan’s fight against terrorism

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In a recent high-level meeting, the federal government of Pakistan announced its intention to launch a new military operation against terrorist organizations. This decision is aimed at eradicating militancy under the banner of Azm-i-Istehkam. Surprisingly, the military leadership has remained silent on this proposed operation, leaving the advocacy to political figures, notably Defense Minister Khawaja Asif of the Pakistan Muslim League (PML-N).

The Pakistan People’s Party (PPP), a significant coalition partner in the federal government, has maintained a conspicuous silence on the matter. Meanwhile, despite the approval from Khyber Pakhtunkhwa’s Chief Minister Ali Amin Gandapur, factions within Pakistan Tehreek-e-Insaf (PTI) and the Sunni Ittehad Council have openly opposed the operation. This divergence in political opinion highlights the complex dynamics at play in Pakistan’s approach to counter-terrorism.

The opposition from various regional and ethnic parties, including the Pashtun Protection Movement (PTM), Pakhtunkhwa Milli Awami Party (PkMAP), and the Awami National Party (ANP), stems from deep-seated concerns about the operation’s focus and its implications. Historically, PTI and PkMAP have not been staunchly anti-Taliban. PTI’s leader, Imran Khan, has consistently opposed military actions against Taliban militants, advocating instead for dialogue. Similarly, PkMAP leader Mehmood Khan Achakzai, while ostensibly opposing terrorism, is perceived to have friendly relations with the Taliban, as evidenced by the relative safety of his party members from Taliban attacks.

Significant religious-political entities have complex stances on militancy in Pakistan

The relative safety of certain political groups, like PTM and the National Democratic Movement, from Taliban violence raises questions. Critics argue that this perceived immunity could suggest covert alliances or understandings, casting doubt on the motivations behind their opposition to the military operation.

Jamiat Ulama-e-Islam (JUI-F) and Jamaat-e-Islami (JI), both significant religious-political entities, have complex stances on militancy. JUI-F’s position has been ambiguous since the Soviet invasion of Afghanistan in 1979. In contrast, JI, having reaped substantial benefits from the Afghan war, now finds itself sidelined and is striving to reassert its relevance by attempting to align with nationalist sentiments.

The media and sections of the government, particularly those influenced by Punjabi and Urdu-speaking elites, have often portrayed the Taliban as predominantly Pashtun. This narrative has led to the proposed military operation being focused on Pashtun-majority areas, such as Khyber Pakhtunkhwa and Balochistan. Defense Minister Khawaja Asif’s statement that the operation will target these regions reinforces this perception.

Pashtun-dominated regions reject the notion that terrorism is a Pashtun phenomenon

However, leaders from Pashtun-dominated regions, like Khan Muhammad Wazir of the ANP, reject the notion that terrorism is a Pashtun phenomenon. Wazir points to the involvement of non-Pashtun militants in numerous terror attacks across Pakistan. He highlights the role of Punjabi militants in groups like the Punjabi Taliban, Lashkar-e-Jhangvi, and Jamaat-ul-Ahrar, who have orchestrated some of the deadliest attacks in recent years. Wazir’s argument underscores the ethnic diversity of militant groups in Pakistan, challenging the stereotype of the Pashtun terrorist.

Wazir’s emotional plea for an operation starting in Punjab, rather than Pashtun areas, aims to shift the focus to the diverse origins of militancy. He names several key figures from Punjab involved in terrorist activities, such as Tariq Lahori of Daesh and Maulana Qasmi of Jamaat-ul-Ahrar. By highlighting these figures, Wazir seeks to demonstrate that terrorism in Pakistan is not confined to any single ethnic group.

Doubt on the narration of the proposed military operation “Azm-i-Istekham”

The insistence on a military operation in Pashtun regions, driven by a media narrative dominated by Punjabi and Urdu-speaking elites, risks alienating the Pashtun community. Wazir’s call for international intervention by entities like China, the United States, Russia, the United Nations, and the Organization of Islamic Cooperation (OIC) underscores the severity of this perceived ethnic targeting. If the government and media continue to frame terrorism as a predominantly Pashtun issue, it may lead to increased ethnic tensions and further marginalize the Pashtun population.

The proposed military operation “Azm-i-Istehkam” and the political dynamics surrounding it reveal deep-seated ethnic and regional tensions within Pakistan. While the operation aims to eradicate terrorism, its focus on Pashtun areas risks reinforcing harmful stereotypes and overlooking the broader ethnic diversity of militant groups. A more equitable approach, recognizing the involvement of non-Pashtun militants and addressing the root causes of militancy across all regions, is crucial for fostering national unity and effectively combating terrorism. Only through such an inclusive strategy can Pakistan hope to achieve lasting peace and stability.

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Huawei Harmony aims to end China’s reliance on Windows and Android

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While Chinese tech giant Huawei’s recent smartphone launches have been closely watched for signs of progress in China’s chip supply chain, the company has also developed expertise in sectors vital to Beijing’s vision of technological self-sufficiency, from operating systems to car software.

Chinese President Xi Jinping told the CPC Politburo last year that China must fight hard to localise operating systems and other technologies “as soon as possible” as the US restricts exports of advanced chips and other components.

OpenHarmony, developed by Huawei, is widely promoted in China as the “national operating system”.

“This strategic move is likely to erode the market share of Western operating systems such as Android and Windows in China as local products gain traction,” Sunny Cheung, an associate fellow at the Jamestown Foundation, a US defence policy group, told Reuters.

In the first quarter of 2024, Huawei’s own version of the HarmonyOS operating system overtook Apple’s iOS to become the second best-selling mobile operating system in China after Android, according to research firm Counterpoint. It has not yet been released on smartphones outside China.

“Harmony has created a strong core operating system for the future of China’s devices,” Richard Yu, president of Huawei’s consumer business group, said at the opening of a developer conference last week.

Self-sufficiency

Huawei first introduced Harmony in August 2019, three months after Washington imposed trade restrictions over alleged security concerns. Huawei denies that its equipment poses a risk.

Since then, China has stepped up its self-sufficiency efforts, pulling out of the main code-sharing centre Github and supporting a local version, Gitee.

China banned the use of Windows on government computers in 2014 and now uses mostly Linux-based operating systems.

Microsoft derives only 1.5 per cent of its revenue from China, its chief executive said this month.

Originally built on an open-source Android system, Huawei this year released the first “pure” version of HarmonyOS, which no longer supports Android-based apps, further separating China’s app ecosystem from the rest of the world.

Huawei said in its 2023 annual report that OpenHarmony was the fastest-growing open source operating system for smart devices last year, with more than 70 organisations contributing to it and more than 460 hardware and software products produced in the financial, education, aerospace and industrial sectors.

Visited by Reuters, Charlie Cheng, deputy director of the Harmony Ecosystem Innovation Centre, said the aim of making it open-source was to replicate Android’s success in eliminating licensing costs for users and provide companies with a customisable springboard for their own products.

“Harmony will definitely become a mainstream operating system and give the world a new choice of operating systems besides iOS and Android,” he said.

Google, Apple and Microsoft did not respond to requests for comment.

China’s previous efforts to build large open source projects have struggled to gain traction among developers, but Huawei’s growing smartphone market share and extra work to develop a broader ecosystem gives Harmony an edge, analysts said.

Huawei’s Yu said this month that more than 900 million devices, including smartphones, watches and car systems, were running HarmonyOS and that 2.4 million developers were coding in the ecosystem.

“OpenHarmony will need more time and iterations for these developers to feel more confident about working with OpenHarmony,” Emma Xu, an analyst at research firm Canalys, told Reuters, adding: “But the reputation, behaviour and trust that HarmonyOS has achieved will certainly have a positive impact.”

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