There are few things observers and die-hard party activists of all political stripes in Pakistan agree on. One such thing is that the national balance sheet looks grim, and is in need of sustainable sources of revenue. There is also broad agreement that innovation and research is good for the country, not only because an educated population can make better decisions but also because research is linked to innovation and innovation to economic development that can contribute directly to increased revenue in the long run. All good so far, but there is a widening gap between theory and practice that continues to squeeze the life out of our nascent research enterprise. Recent actions by the State Bank of Pakistan are an example of such counterproductive measures that are going to permanently derail the research activity in the country.

To put things in perspective, on July 14th 2018, the State Bank of Pakistan, in its FE (Foreign Exchange) Circular No 6, took away the capacity of authorised dealers of foreign imports to make advanced payments. As per the circular, these authorised agents must get approval from the SBP before they can make payment for foreign imports. So how does this affect our research activity? Well, it turns out that Pakistan does not have an industry to support research activities and basic consumables for research are imported from outside. It is not that the local ones are not good enough, in many cases there are no local options. The consumables range from basic hardware for physics and engineering experiments, to chemicals for chemistry studies, to biological consumables for biochemical, biological and biomedical research. These consumables are essential to study, understand, inquire and create. These consumables are needed on a regular (sometimes daily) basis and taking away the ability of researchers to procure them directly from abroad would mean an end to the experiments, and hence research. Furthermore, adding a convoluted layer of bureaucracy (i.e. explicit approval of State Bank) means that not only the procurement of these materials will be delayed by months or years, it will also take away the valuable time of researchers. The research staff will now be spending time on creating unnecessary documentation and making needless visits to offices of the State Bank, which will create frustration and resentment. It will be a disincentive to do research in the country. On top of this, to the staff of the State Bank already stretched thin by other national responsibilities, consumable procurement for a set of experiments, I am sure, is the last thing that it will attend to.

This new ruling affects research activity in another dimension as well. In recent years, the country has seen the uptick in DIY (do-it-yourself) research industry where new ideas and new technologies are being developed by local researchers. New tools and local versions of existing equipment are being developed as well. These new tools, that range from medical technologies to those for pollution control, rest on parts and pieces that are imported from abroad and put together in creative ways. This activity, on the one hand, has generated new interest in research and on the other, democratised technology innovation. The State Bank ruling would permanently destroy this organic innovative spirit as they are dependent on foreign suppliers for the parts and consumables, and there are no local industries to meet the demand. The ruling in essence will hurt the momentum for self-reliance and economic empowerment through research.

While the new government is in, this regulation from the caretaker period still stands. It is unclear what the intent of the said policy is. If one was being charitable, one could argue that the intent of the State Bank is to control the flight of capital or perhaps it is to regulate imports. Unfortunately, whatever the intent may be, the reality here is attacking the very foundations on which we hope to build an independent, inquisitive and creative Pakistan.

Published in The Express Tribune, August 28th, 2018.

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