By Wafa Hassan
(Student of 2nd Semester BS Political Science GPGGC Saidu)
In the 21st century economy is considered the religion for any state. Pakistan’s economy is sinking day by day. Question arises here that what measures should be owned by the current government to let the country out of poverty and improve the economic condition of the State.
The rupee has been devalued, interest rates have gone up, and inflation has increased. The weak governance of the present and past rulers has contributed in growing militancy, economic turbulence and instability in the country.
Pakistan’s economy is under terrible crises due to the following reasons. One of the immediate causes is political instability. Pakistan held its most recent elections in July 2018. Resultantly, Pakistan Tehreek-e-Insaf won over 100 seats in the parliament and its founder Imran Khan was elected as Prime Minister. He inherited a balance-of-payments crisis which has been a consistent issue since long. According to journalist, Arshad Hussain, Pakistan had a current account deficit (CAD) of $18bn in 2017-18 nearly a 43% increase from an account deficit of $12.4bn in 2016-17. Excessive imports and low exports led to a CAD which is constantly widening, pushing the country towards more difficult economic situations.
Fiscal year 2018 was the worst year for Pakistan because of increase in oil prices and lack in foreign direct investment (FDI), negatively impacted the country’s already precarious economic situation. Perhaps the greatest financial issues facing Pakistan are its persuasive tax evasion and low level of domestic resource mobilization. Taxes in Pakistan comprise less than 10% of countries that are part of organization for economic cooperation and development (OECD). Pakistan also suffers from impediments in the energy sector.
In western media, Chinese investment is often cited as the main driver of Pakistan’s debt crises, because China and Pakistan are key partners in CPEC program with a total investment of $60bn. It is a program of infrastructure, energy and communication projects that aims to improve connectivity in the region. CPEC infrastructure costs have certainly placed a greater debt on Pakistan.
Our motherland came into being because of millions of sacrifices made by our forefathers; therefore it is the prime duty of every individual to uphold the constructive norms in order to get honor in the community of nations. Pakistan is not a poor country, but a poorly managed country. Only a sincere leadership with real commitments can put Pakistan on the track of development and prosperity.
