According to the State Bank of Pakistan, the external debt of the federal government in the period from November 2022 to November 2023 reached 63 thousand 390 billion rupees after an increase of 12 thousand 430 billion rupees.  There are still 6 months of the current financial year and the government has borrowed 907 billion rupees from July to November.  In November 2022, the value of the debts owed by Pakistan had reached 50 thousand 959 billion rupees, while in June 2023 it had reached 60 thousand 841 billion rupees.  In these circumstances, privatization of public sector enterprises is seen as a support for the government and this process has been going on for more or less two decades.

According to economists, their sale will create many problems and a huge storm of unemployment. There are various reasons why the economy has reached the current state, the main ones being the economic and social problems arising from the unequal distribution of wealth and corruption. Restructuring is needed, otherwise the government will have to multiply its sources of income, which has already been going on for four to five years, and every time it falls on the poor, salaried and already tax-paying classes.  The Business Facilitation Council is working tirelessly to achieve the goals, but the handling of economic conditions is a question mark until unnecessary facilities are withdrawn from the privileged class, a large part of whom are non-tax payers. Today, the outstanding debts of the country have exceeded 62000 billion rupees. Currently, among the countries and international organizations that Pakistan is indebted to, the IMF, World Bank, Asian Bank, Paris Club and friendly countries China, Saudi Arabia and the United Arab Emirates are at the top.  According to a report of the World Bank, Pakistan is among the 10 countries that have taken the most debt at the global level. When it comes to the largest debtor countries of the IMF, Pakistan ranks fifth after Argentina, Egypt, Ukraine and Ecuador.  In the loans received from the IMF, Pakistan is at the first place. It is coming that someone else takes the loan and someone else pays it. Finally, all this has to be paid by the taxpayers of the country. Where the lovers of Pakistan. Citizens who care about the country and its pain are trying to bear this burden, it is a moral requirement that all stakeholders understand their responsibilities, the day every citizen participates in it, depending on the status, to remove foreign debts and development.

And it won't be long before the unstoppable journey of prosperity begins. We are in vicious cycle of debts. Of the debts owed to Pakistan, China's debt alone is worth more than 36 billion dollars. In contrast, the IMF's debt is 7 billion 800 million dollars, but this institution is repeatedly rubbing its nose with Pakistan to give more loans.   It is the result of IMF's strict conditions that the inflation in Pakistan has crossed all the limits of history and the people are crying out. Due to Pakistan failure to keep up past promises, the IMF is constantly putting pressure on Pakistan and its conditions. The government should make an effective policy especially regarding foreign debt and take effective measures to put the economy back on its feet through austerity policies with the help of friendly countries.  Right now, the situation is such that not only the government but also the people have to think more about living within their means. It may be recalled here that when the Pakistan Tehreek-e-Insaf government came to power in 2018, the amount of foreign debt owed to the country was 28 thousand billion rupees, and at the time of its termination it was 45 thousand billion rupees which shows a massive increase in foreign debts. In fact, it was the biggest increase ever in our foreign debts as compared to previous regimes. In fact, PTI was claiming to be against foreign loans but at the same time, it was accumulating more and more debts. The burden of debt increased by a whopping 100% during the IK’s government and the debt which was 25 trillion in 2018, rose to a daunting 49 trillion in just three years. After PTI’s government, the process of debt has slowed down, but even then its value has exceeded 64 thousand billion rupees indeed. Rcently, the Ministry of Finance issued a very alarming report on the increase in domestic and foreign debt, according to which the amount of debt owed to the country, which was showing an increase of 36.9 percent in June 2022, this year.  This rate has reached 38.23% in previous months.

Meanwhile, the buinessmen and industrialists say that our government does not want business in the country, especially medium-sized businesses have been made the most difficult.  It is happening, there are 15 to 20 government agencies to run the factory, which instead of helping the business, they are behind us to stop the business and compel on bribe, then if you go to take a loan from the bank, you get an interest rate of 25 to 27 percent. You tell yourself that which business in the world can be successful by taking money at 25% interest rate?  This is not the case in other countries, in Japan, loans for buying a house are given at one percent interest rate, for business, loans are provided at two to three percent interest rates. While private banks, when they keep their money in the state bank, they also have to pay its fees, so the banks try to give the maximum amount to the public at the minimum interest rate, i.e. one to three percent interest rate.  In order to increase the business activities in the country, while the people also have no benefit in keeping money in banks because the interest is negligible, that is why whenever you talk to a Japanese person and he is told that the state interest rate in Pakistan which is If he is told about twenty-one to twenty-two percent, he sits down, many Japanese economists say that in a country with such a high interest rate, business will automatically end, not only that, but now overseas Pakistanis also think twice about investingin Pakistan.  Due to rising inflation and high interest rates, instead of sending money from abroad, families have started making fixed deposits in Pakistani banks from which the interest earned, known as profit, can easily pay their household expenses.  Recently, a friend deposited one crore rupees in a local bank in Pakistan, from which his family receives two and a half lakh rupees per month.   At this time millions of people have stopped doing business and started earning monthly income by depositing their economic assets in banks, which is ending the business activities in the country. If the government wants to take Pakistan on the path of development, it has to discourage usury and attract people to business, for which facilities must also be provided.  Japan's economic system is the best role model for Pakistan in this connection.

Published in The Daily National Courier, January, 09 2024

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