ISLAMABAD  -  Experts at a high-level policy forum on Wednesday demanded of the International Monetary Fund (IMF) and other global finance lending institutions to ensure relief for growth in Pakistan keeping in view the plight of common masses and the prevailing economic conditions of the country.   

They noted that in the context of a new IMF programme and upcoming budget for FY 2024-2025, Pakistan’s economic stabilisation reforms need to have a human face to promote balanced recovery and inclusive growth that does not burden the people and improves the country’s human development indicators. The forum titled: “Prosperity for Pakistan: Reforms for National Economic Growth” was organised by Sustainable Development Policy Institute (SDPI) in collaboration with the United Nations Development Programme (UNDP) and the World Bank (WB).

Dr Shamshad Akhtar, the former caretaker Minister for Finance and Revenue, said the country needs to undergo massive transformation for economic sustainability as it demanded inclusivity and climate resilience as the key components of the prosperity agenda. She added that macro-economic stability has to be ensured through adequate process and reinforced with great commitment through significant revenue enhancement along with focus on remote earnings to be aligned with increase in its earning agenda. Dr Akhtar underlined that the country had to abandon domestic and external debts with improved taxation footprint and productivity improvements to achieve the goal of economic growth. She highlighted the need for a whole-of-government approach for reforms. “Macroeconomic stability has to be our religion,” she argued. “We have to make sure that it is adequate to get us out of the low and volatile growth trap, and it should be re-enforced by bold structural reforms. The single most important obsession the country should have is revenue enhancement and export earnings,” she maintained.

In his opening remarks, Dr Samuel Rizk, the Resident Representative of UNDP Pakistan, said it is an important high-level dialogue that focuses on Pakistan’s economic trajectory. “Pakistan needs to focus on marco-economic stability, debt recovery, and improved revenue generation for its prosperity,” he said, adding that the country has largely faced the impact of global macro-economic fallout, COVID-19 pandemic and Ukraine-Russia war. Dr Rizk further said that the country’s economic fault lines are turning risk into threat, whereas the sustainable economic policy initiatives require cooperation from stakeholders and international community to achieve economic revival and improvement. Dr Abid Qaiyum Suleri, the SDPI Executive Director, said the recommendations presented by the experts are identical to the domestic agenda for economic betterment of the country. He recommended that the country needs to fix the leakages in its economic system, the chronic menaces like state-owned enterprises that are damaging the national economy.

“It is not possible for the country to avert a default like situation amid more economic compromises towards non-tax paying sectors,” he added. Moreover, Dr Suleri said, “It is also necessary to advocate for the IMF to review impacts of its recommendations on the people of Pakistan during its quarterly review and while making an assessment of how it is impacting the life of common masses.”  

Kanni Wignaraja, the UN Assistant Secretary-General and UNDP Regional Director for Asia and the Pacific, said the green economy is not a luxury but a living reality in the prevailing times, whereas many Asian countries have transformed their transport sector that indicated low subsidy on fuels and increased incentive for eco-friendly means. “It’s not the issue of behaviour change but the issue of access to technology to improve governance. For example, she said, “Universal access to Wi-Fi is imperative to ensure economic justice with infrastructure development, whereas dignity is critical in the human development landscape.”

Ms Wignaraja said tax subsidy equations in developing countries show direct correlation with more burdening of the already taxed and less inclusion of the untaxed sectors. “Pakistan’s debts go more into consumption than to increase productivity. However, we have to carry our own narrative and issues as Pakistan has to make its news choices to overcome the economic crisis. It has been dragging its debt for decades and should explore new opportunities and take its affairs and decisions into its own hands,” she added.

Pakistan should not import the things which are burdening the debt consumption, she said, adding that the country needs a viable and single source of finance to address its economic woes.

Tobias Akhtar Haque, Lead Country Economist and Acting Country Director, WB-Pakistan said Pakistan needs to reduce budgetary deficit to lessen debts and utilise resources for human and infrastructure development.

He added that it is crucial for Pakistan to have a balanced budget to create fiscal space for growth and economic recovery. “However, it is necessary to review fiscal exemptions and those with political motives should be closed to start taxing the untaxed sectors like real estate and large agricultural farmland owners,” he maintained.  

Mr Haque said the subsidies provided to the energy, fertilizer and gas-based industries needs to be abolished to ensure efficient movement of economy and stop benefitting wrong people and support social development initiatives like Benazir Income Support Programme (BISP).

In his closing remarks, Dr Abid Suleri extended the vote of thanks to UNDP and SDPI teams and the participants for making the session vibrant and interactive.

He said two myths to be broken that Pakistan is among the least emitters as there are around 100 more countries in this category and its ranking is 20th in terms of low Greenhouse Gas (GHG) emissions.

In terms of climate finance, Pakistan needs to explore private climate finances through evidence-based approach and proper homework, he concluded.