Is Nawaz's Youth Loan Program a silver lining, or another gimmick?
My Twitter feed is abuzz these days with the Prime Minister's Youth Loan Program. From concerned individuals trying to better understand the terms and conditions of the loan, to those who have found a new ball for their political ping pong, this initiative has garnered enough interest to continue to headline news and spark debates.
From an economics perspective, more people vying for their business would create competition and thus lead to lower and more efficient prices, a benefit any consumer would appreciate. Who would pass up a bargain the next time you are out looking for sneakers?
New businesses would create jobs that would employ people and provide for families. It would, hopefully, generate more tax revenues for the state. It would get some of our easily brainwashed youths off the street and turned into productive members of our society.
So what really could go wrong?
First off, it is reported that initially only 100,000 people will get to access this loan.
What criteria, apart from the one published, would be used to select these individuals?
How many of these loans have already been earmarked for those that have run the current government’s campaign in the previous election? What vetting mechanisms will be in place to prevent this?
How much of this money could have been used to set up schools designed to provide apprenticeships or create skilled labour?
Perhaps the biggest question is how likely are the target applicants, mostly educated yet underprivileged youth, to find guarantors?
Even if some do find a guarantor -- someone who must be a government employee serving in Grade 15 or above -- who is to say the system will not be exploited to funnel the money back to the guarantor?
These are just some of the many questions that come to mind.
For anyone who is not already aware, nepotism is quite popular in our country.
What the youth program might inadvertently do is pump more ‘idle’ cash into a system riddled with corruption and inflation. Instead of creating jobs, competition and lower prices, it could do quite the opposite, as if daily sustenance wasn’t expensive enough already.
Since the program is in its infancy, many of these issues can be addressed through an ongoing (not after the fact) external audit.
As a country mired in problems aplenty, we should look for the silver lining in the many things that happen around us. The youth needs to feel the government is serious about creating opportunities, especially those that may otherwise be drawn towards extremism.
We should welcome the thought, and hope against hope this doesn’t go down the same path as the yellow cab scheme or the infamous laptop debacles’ sorry distribution.
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