1990s onwards, on one side economy of Pakistan, went down with a rate between 3% to 4%, poverty rose to 33%, inflation grew in double digits. Foreign debt has already attained an alarming figure. Such is the enormity of debt that it has the potential of gobbling up almost the entire GDP of Pakistan. An unprecedented economic and monetary crisis is threatening to bring Pakistan’s stock considerably down in the world order.
Once Upon a Time
Soon after the partition, Pakistan emerged as a promising state. First, four decades from the 1950s to 1990s were indeed encouraging despite having witnessed coups under the tyrannical rule and military dominance. The leadership of the nation was able to ensure the growth of the economy to attain and maintain an impressive rate of 6% per year. In addition to this, they were able to almost double per capita income. Not only this, they also carried out a successful surgical strike on poverty and bring it down from 46% to 18% until the late 1980s while keeping inflation low.
How Serious is the Malaise?
By all yardsticks, Naya Pakistan seems to be in deep trouble. GDP growth rate remains despicably low at 3.3% in 2018-19. A comparison with the targeted GDP growth rate of 6.2% brings forward the fact that something has gone terribly wrong in the economic management of the country. The gravity of the problem can be gauged from the fact that despite getting money from China, Saudi Arab, and IMF. Pakistan is approaching the Asian Development Bank for another US$ 3.4 billion to keep the state afloat.
Promises Made, Never Fulfilled
The Imran Khan led government did promise following growth figures in different spheres:
- 8% growth in agriculture
- 6% growth in the industry
- 5% growth in services
- The overall growth of 6.2% in GDP
None of these figures were attained. Paradoxically the country has drowned further into the financial abyss.
A holistic economic analysis, unfortunately, reveals that Pakistan is exhibiting all the symptoms of a fast failing state. Main tell-tale signs are:
- The country is in the grip of a severe debt trap.
- Following the idiom “Rob Peter to pay Paul”, It has been taking loans to pay loans and then more loans to repay those loans.
- Riyasat-e-Madina has been mortgaging airports, radio stations, railways to raise loans.
- There is an acute scarcity of fuel in stock culminating in worst power shortages till date.
- Pakistani currency has undergone a sharp devaluation against the US dollar.
- Pakistan has been added to the Global Financial Action Task Force’s (FATF) “grey” list of countries. The agency is on the prowl to book Pakistan for terror financing.
The country sought yet another IMF bailout for the 22nd time to stabilize the fumbling and stumbling economy. The country already owes $5.8 billion to the IMF from past rescues and has been able, so far to effect timely repayment just once.
Pakistan’s growth rate is set to hit an eight-year low, with all its major indicators showing a southward trend. Its economy has also damaged significantly after tensions with India aggravated due to Pakistan’s support, shelter, finances, and training provided to terrorists.
Nurturing Terror as an Instrument of State Policy
The Pakistan Army is time and again alleged to be sponsoring of all terrorist groups operating from the soil. A significant amount of Pakistan’s budget goes to its military. The Pakistani state and the army have become extremely obsessed with nurturing terrorism and radicalism as they provide them with the wherewithal for proxy campaigns against neighbouring countries.
The irony is that to set right the wrongdoings the very perpetrator is being set as a law enforcer. The recently constituted Economic Security Council of which to deal with the economic downturn has General Qamar Bajwa along with PM Imran Khan as its member. Now who will be calling the shots, is anybody’s guess.
These Frankenstein’s monsters along with the military itself now dominate the resources, the young minds and the social haves of Pakistan. Even international pressure and economic compulsion force the rulers of Pakistan to pin down terrorism and fanaticism, they might discover to their dismay that they have the tiger by the tail.
Imran Khan seems to be a genuine person with good intentions. His actions have a semblance of taking steps against terror groups operating from within the country. Is this just a facade to obviate the blacklisting by Financial Action Task Force (FATF). The ground reality suggests so. Would the ruling elite of Pakistan allow the nation to pass into bankruptcy? Is this the Naya Pakistan, Imran envisaged?.
17 Jun 19/Monday Written by Naphisa