It is well-known that Pakistan is one of the water-stressed countries and looming water crisis is a major risk for its economy. Highlighting this fact, a report titled “Regional Risks for Doing Business” released by the World Economic Forum (WEF) has listed water crisis as the top most risk for Pakistan followed by unmanageable inflation, terrorist attacks, failure of urban planning and critical infrastructure as immediate risks faced by the country with 220 million inhabitants. These risks were identified after the WEF carried out an “Executive Opinion Survey” and findings were tabulated after receiving responses to survey’s risk-related questions for the South Asian region – Bangladesh, India, Pakistan and Sri Lanka. The report has highlighted 10 major risks to doing business in South Asia, including failure of national governance, unmanageable inflation, unemployment and under-employment, cyber-attacks, failure of critical infrastructure, energy price shock, failure of financial mechanism or institutions, water crisis and large-scale involuntary migration. Countries in the South Asian region are prone to failure of national governance as national elections in these countries are usually observed with anxiety due to the likelihood of violence, blockades and tensions. They are also susceptible to cyber-attacks and the region’s vulnerabilities came under spotlight after Bangladesh Bank was hit by hackers who got away with one of the biggest heists in history, robbing the country’s central bank of more than dollar 80 million. Geo-political concerns were relatively muted, with “failure of regional and global governance” and terrorist attacks in ninth and tenth place globally, respectively. “Interstate conflict” was ranked in the top three risks in 17 countries, most of them located in Eurasia and Eastern Europe.

We feel that the above-mentioned report of WEF is a good commentary on the risks to a number of economies, particularly in the South Asian region and should induce the policymakers to initiate measures to mitigate these risks over time. While every country has a different set of risks, water crisis has been listed as the biggest risk to the economy of Pakistan. The strange aspect of this risk is that though this has always been there, it has been recognised as such only recently and after due emphasis and publicity by the Chief Justice of the apex court of the country. Compounding this problem is the rapid climate change, resulting in a number of hazards like heat waves, change in the rain patterns and deadly storm surges. The Paris climate treaty, inked by 195 nations in 2015, called for holding the rise in temperature to “well below” the 2C, but unfortunately, the US which has the biggest economy of the world has disowned the treaty which may result in various calamities like extreme drought or rains, sea level rise and storms. Another factor which may further deplete water resources in Pakistan is the attitude of India which is always trying to draw more water from the rivers than allowed under the Indus Water Treaty. The policymakers of the country have responded to this challenge by taking certain initiatives like establishment of geomatic centre for climate change and sustainable development, green Pakistan programme, sustainable land management project to combat desertification, flood forecasting and warning system and installation of weather surveillance radar at Karachi but these measures are not up to the task and could make only little difference and that too in the long run. In the meantime, we could only conserve water resources by checking over-population and reducing the migration of rural population to urban areas, introduction of drop irrigation on a wide scale and construction of dams at appropriate places. In no case should we waste this natural resource mercilessly. Hopefully, the present report of the WEF would make our policymakers more aware of the issue which could be a matter of life and death for Pakistanis in the years to come. However, one could easily argue that Pakistan is not facing unmanageable inflation as highlighted by the report. Over the past few years, inflation was highly muted and could continue to be managed by appropriate fiscal and monetary policies in future. Also, the risk of “interstate conflict” is not limited to Eastern Europe and Eurasia. Countries like India, Pakistan and Afghanistan could also easily fall into this category. Actually, low-level conflict is already there which could escalate to high intensity conflict if the leaders of these countries continue to harbour a hostile attitude towards each other.