With the IMF, Saudi Arabia, and UAE extending their utmost support at a time when Pakistan was prone to default, our ruling elites have yet another arduous journey to embark on to revitalise the economy of the country. Since current loans won’t last longer, our leadership at the top must address key issues confronting Pakistan in terms of economic instability. It is worth noting that no country can drive economic growth merely through loans and that if we are serious about economic stability, we must undertake deep-rooted policy changes.
Given the worst-case economic scenario, the underlying reasons for our lagging economy must be discussed in depth. Most importantly, our rising internal and external circular debt of around $126 billion, excluding recent loans, is a major impediment on our pathway towards coveted growth. The PTI chairman, Imran Khan, during his tenure in office, constantly blamed circular debt for the sluggish growth of our economy. He maintained that a high debt trap coupled with soaring interest rates and low GDP growth are major concerns, clipping the wings of our economy to new heights. Also, our economy is being incessantly plagued by a balance of payments crisis, wherein our imports weigh heavier than our exports.
Provided that the weak economic base has stunted the growth of Pakistan, one question arises in our minds as to how to let our derailed economy get back on track. The possible way out of that is that we must stabilise our institutions like FBR and NAB to generate revenue on the one hand and retain that revenue in our exchequer on the other. Tax subsidies, a conducive political environment guaranteeing consistent policies even after regime changes, and strong security measures can woo investors to resume their business activities in our country. Also, in order to plug the gap caused by the balance of payments crisis, we must produce value-added goods and try to shun import-based inclinations. If these measures are implemented in true spirit, we are bound to see better economic days ahead soon.