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Editorial: Acts of terror and economic cost

October 3, 2013 at 8:48 pm | News Desk

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From the Editor’s desk

Fighting the war on terror compromises the economy now and threatens it in the future

International terrorism became a prominent tool in political agendas in the late 1960s. A major act of international terrorism occurred on September 11, 2001 in a set of coordinated attacks on the United States.

The US has made the “War on Terrorism” the centerpiece of its global strategy since the attacks on the Pentagon and World Trade Centre. It has proclaimed leadership of a worldwide alliance to exterminate the scourge of terrorism.But whatever the motives, the act of war, be it an offence, or an act of defence comes at an economic and social cost. There is more than some truth to the fact that often terrorism is rooted in social and economic deprivation.In the immediate aftermath of the American invasion of Afghanistan in 2001, Al-Qaeda and the Afghan Taliban sought refuge in the Pakistani tribal belt due to the porous international border and started offering resistance to US forces from safe sanctuaries. Socioeconomic and politico-religious conditions in the tribal region also favored these militants.

The world is currently confronting terrorism in its different manifestations. After 9/11, terrorism has abruptly changed the socio-economic and geopolitical situation of the world. Pakistan is also facing the menace of terrorism which is eroding the country’s social structure, economic development and political system. Acts of terror are threatening law and order conditions, violating human rights, damaging basic infrastructure and killing economic opportunities.

In the post-9/11 scenario, effectively checking political violence and terrorism in Pakistan through preventive legal measures remains a challenge at both the state and local levels. The immediate costs of terrorist acts are loss of human lives, destruction of property and infrastructure and curtailment of short-term and eventually, long-term economic activity. Additionally, terrorism creates uncertainty, reduces confidence and increases risk perception, leading to lower investment and weak economic growth. According to official estimates, Pakistan has suffered a loss of around $35 to $40 billion since 2001-02 due to the war on terror. Its economic growth came to a near halt at around 2% in fiscal year 2009, not only as a result of the global financial crisis, but also because of internal issues.

The war on terror and rehabilitation of internally displaced persons consumed a big chunk of the government’s financial resources, widening the fiscal deficit and halting economic growth. According to experts in international economics, the soft image of a country is like a cashable commodity, as it is an important source of attracting foreign direct investment. FDI fell to $463 million in the first quarter against $1.116 billion during the same period the previous year, a decline of 58.5%.

Pakistan’s response to Sept. 11 to fight against war on terror as a frontline state has weakened both the current economy and its future economic prospects. And that legacy of economic weakness — combined with the erosion of the credibility of our military power and of our “soft power” — has undermined, rather than strengthened, our national security.

Decision by the finance minister, Ishaq Dar to exclude the chapter of cost of war on terror so far Pakistan has suffered from the Economic Survey 2012-13 will certainly not changed the facts. Pakistan MUST needs to redefine its policy on War on Terror keeping in view the impact it had on its economy so far as well as in future.

Pakistan as a frontline state on War on Terror needs to send a “SOS” call to the world community to bail her out from the current economic crisis, otherwise, how far a country can fight a WAR against terror with economic conditions terrorizing her, is a million dollar question.

 

News Desk

Economic Affairs Editor

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Guest
4 years 1 month ago

do you have a twitter that i can follow