Neck-deep in problems

Sunday, Oct 17, 2021

Pakistanis are suffering from a historic economic meltdown characterised by low economic growth, high inflation and rising unemployment. The country’s economic situation is indeed worrying. The growth rate that was close to six percent in 2018 is now under four percent. The Pakistani rupee keeps depreciating against the US dollar. The issue of the ever-increasing national debt, which takes around 20 to 40 percent of the budget each year, has no end in sight. Pakistan continues to borrow loans to pay back its debt. The other important issue that the country is facing is its trade deficit. Trade plays an important role in strengthening a country’s economy. During the last few years, Pakistan’s imports have risen to alarmingly high levels. Pakistan is an agriculture country producing large amounts of wheat, cotton, among other crops. However, it imports wheat, pulses and vegetables to meet domestic demand. The reason for this shocking situation is our decreased productivity. Pakistan has an abundance of natural resources, but it is dependent on foreign aid and loans.

The country has low sources of income/revenues and high expenses, which is a recipe for a financial disaster. Pakistani authorities have failed to establish an effective mechanism for tax collection. The authorities need to have a look at these problems and come up with a way to deal with them in an effective manner.

Kurbeet Singh