The messy reality
The economy is in dire straits. Prime Minister Shehbaz Sharif spoke the obvious as he dilated the inherent problems that the economy faces, and lamented that it is off the track even after the passage of seven decades. By pinpointing issues that have come to derail it, he made an honest assessment of ground realities and regretted that it is impacting the country’s image at large. The dismal picture was owing to the economy’s inability to bounce back as it had traditionally relied on foreign loans, while being obsessed with a sense of ad hocism. This is what the PM meant as he called a spade a spade by saying it is a ‘now or never’ situation.
To further compound the messy scenario are the floods that have come to devastate it to the core. Infrastructure debacle and washing away of standing crops during the monsoon deluge has pitched it to the edge. The damages are estimated at around $40 billion, and come at a time when the currency is in the stampede zone and inflation is skyrocketing. Last but not least are the spiraling current account deficit and a slump in exports. This necessitates a holistic approach and can only be overcome if all the national stakeholders are on one page, and a new charter of economy is written. Thriving on borrowed money and passing on the buck of blame-game has not delivered.
The PM has brought to the fore a few pressing issues, and they need some serious introspection. He said while the country possesses all the potential to make it big, it is lacking in the will to do so. This must be taken as the biggest setback in our policy approach, which is defeating the resilience of the nation. Thus the off and on threat of default, and a slowdown despite being under the IMF programme are signs of policy decay. Likewise, energy deficit as winter looms large is likely to cripple the situation of making both ends meet. The need of the hour is radical austerity, and one that ensures change. Only then can the fundamentals of macro-economy be reinvigorated towards growth and self-reliance.
Published in The Express Tribune, September 16th, 2022.
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