PM Imran Khan. PHOTO: PID
ISLAMABAD: Pakistan’s main opposition party on Tuesday accused the government of fast pushing the country towards civil disorder by implementing wrong economic policies that could throw 94 million Pakistanis below the poverty line and may push external debt to $135 billion in three years.
In its first comprehensive response to the Pakistan Tehreek-e-Insaf’s (PTI) economic policies, the Pakistan Muslim League-Nawaz (PML-N) issued a white paper titled “Clarion Call, Rescue Economy”, which discussed the social and economic implications of the International Monetary Fund (IMF)-dictated policies, implemented by Prime Minister Imran Khan.
“Selected through a rigged election and a stolen mandate, Imran Khan government inflicted on 210 million Pakistanis the worst era of governance in Pakistan’s history, marked by catastrophic mismanagement in national security and economic policy and condemnable degradation of human development and constitutional rights of Pakistani citizens,” alleged the PML-N.
In response to these charges, Federal Minister for Economic Affairs Hammad Azhar, through his Twitter handle, stated, “The amateurish and half-data white paper that the PML-N has produced brings on full display its lack of capacity on economic issues. No wonder they drove the economy into a deep crisis and near default by the time they left office.”
Azhar said the white paper was a combination of cuckoo economics and non-economic rhetoric. The PML-N said PM Imran in his first 16 months in government hurt Pakistan’s poor with an extortionate 12.7% inflation and destroyed families through endemic unemployment.
“There will be Spring Revolution in every spring, if we did not reverse the current economic policies,” said former planning minister Ahsan Iqbal, while speaking at the launch ceremony of the white paper.
With high inflation, poverty and unemployment, the country was heading towards social and civil disorder, said Iqbal. The PTI government also rolled back the China-Pakistan Economic Corridor and jeopardised the nation’s future, he added.
The white paper had been prepared by the PML-N Economic Advisory Council whose two members, Shahid Khaqan Abbasi and Dr Miftah Ismail, were languishing in jail for speaking truth, said Marriyum Aurangzeb, former information minister.
Pakistan was still facing serious financial and economic crisis, said Dr Ayesha Ghaus Pasha, a member of the PML-N’s Economic Advisory Council and member of the National Assembly. She presented a critique of the IMF programme.
The IMF deal overburdened people, the fiscal and monetary adjustments were more than the requirement and wrong policy choices were made, said Pasha.
The government implemented three-year policy actions within one year and as a result the economy was suffocating, she added.
While bearing in mind the intensity of the IMF actions, she said, the government should have signed a standby agreement (SBA) instead of the Extended Fund Facility.
Out of the loan of $6 billion, the net IMF lending in three years would be less than $3 billion but the damage it caused was humongous, said Pasha.
Owing to wrong economic policies, the number of poor people would increase from 69 million in 2018 to 94 million by 2021-22, said Pasha. The numbers suggest a 36% increase in poverty in four years of the PTI government.
She said the external debt, which stood at $96 billion in 2018, would surge to $135 billion by 2021-22 - the time when the IMF programme would end. By implementing a different set of economic policies, the PTI government could have saved one million jobs and eight million people from slipping into poverty while still remaining under the IMF programme, argued Pasha.
PML-N MNA Ali Pervaiz criticised the quality of current account deficit adjustment, arguing that out of the total improvement, 67% improvement in the current account deficit was because of measures that were not related to exchange rate depreciation.
“About 45% improvement in the current account deficit was because people either stopped investing or work on ongoing power plants was completed while 22% improvement in the deficit was because the commerce ministry stopped imports of cars through red tape,” said Pervaiz.
He said the real impact of 40% currency devaluation on the current account deficit reduction was only 33% but the damage it caused to the economy was enormous.
The PML-N’s white paper also carried a list of 13 promises that the PTI government made but could not fulfil.
The commerce adviser had claimed that exports to China would jump by an additional $1 billion within a year. However, from July through October 2019-20, the exports to China stood at $586.4 million, down 1.5% as compared to July-October 2018-19.
The energy minister claimed that the circular debt had been reduced to Rs10 billion a month. The Asian Development Bank (ADB), however, says the circular debt was Rs21 billion per month as of the end of August 2019.
Asad Umar as finance minister had claimed in his budget speech in September 2018 that PSDP funding would be higher than last year of the PML-N government. Actually, the PSDP spending went down 25% to Rs502 billion by June 2019.
PM Imran claimed that overseas Pakistanis would trust his honest government and invest in the home country. However, only $27 million was invested in the PM’s overseas investment certificates despite offering very high profit rates.
The premier promised to bring back the $200 billion stashed abroad. Despite sharing of data of 152,000 bank accounts by the OECD, only $6 million could be recovered.
Published in The Express Tribune, December 18th, 2019.
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