In a 'good spot'?

Pakistan's obsession with a staff-level deal with the Washington-based lender has come full circle. The solace is that the successful second loan review with the IMF will see a new tranche doled out by December, cushioning the borrowed economy with some relief. The finance guru on an optimistic note has, however, stressed the need for synergising the economy on the lines of proactive reforms that have got a pat from the Fund, and that specifically entail expansion of tax base by using AI, digitising the entire spectrum of economy and focusing on existential issues such as climate change and population control.

To boast at inception, the government has an addition of 900,000 new tax filers incidentally in a country where millions of elite and movers-and-shakers are still out of the tax net, as burden is heaped on salaried class and on direct retail taxation. The recent deception wherein Sindh and Punjab decamped from their commitment to enforcing agriculture tax at the rate of 45% is a case in point. Last but not least, despite 23 programmes with the IMF, sustainability and self-reliance remain a far cry as savings and wealth generation are concept notes in limbo.

However, it is interesting to note that the government has picked up climate change and population explosion as two of the bastion issues that will have a detrimental effect on an already stalled and fragile economy. Thus, the altered focus is on competitiveness, youth empowerment and the effective use of external funding. The thrust is on emerging sectors, technology and innovation to build a sustainable, inclusive economic model. The only departure from yesteryear's strategy, as is evident from the resolve, is a shift toward an investment-driven economic model, led primarily by the private sector.

A lot needs to be done to resurrect the economy and pull it out of the clutches of foreign lending. Getting the house in order by ushering in political stability is a sine qua non, to be followed by winning the confidence of the investors and local entrepreneurs. Only then can we dream of big-ticket investments and a rollover into stable zones of productivity.