- $13 billion, Pakistan’s planned borrowing for 2018-19
Maintaining the illusion of an overall economic equilibrium, while holding out hope of credible financial upturn in the future will test the cerebral skills (such as they are) of our rulers and makers of next years’ fiscal budget to the utmost, demanding employment of creative juices, out-of-the-box thinking and some lucky breaks. All the well-meaning, if not well-laid, plans, dubious statistics and unrealistic monetary goals set out in the annual futile ‘budget blues’ exercise fall apart at the initial stages, with rebellious traders staging successful protests against imposition of any tax measure targeting their deeply lined pockets. A list of chronic ills plaguing the country’s economy is like listening to a worn out old phonographic record, with its recurring current account and trade deficits, always depleted foreign exchange reserves, rocketing external liability, low tax collection, uncompetitive manufacturing cost, pathetic exports, reckless borrowing and manifold increasing imports. So, commenting on the economy is akin to asking questions whose answers we know in advance. If it is not an ongoing IMF programme, the sponging spree may involve the World Bank, Asian Development Bank, Islamic Development Bank, Euro/Sukuk bonds, China, and short-term loaning from foreign commercial banks.
Repeated warnings voiced by international lending institutions have gone unheeded through lack of political drive and will to take action. Now the chickens are coming home to roost, and simply to remain afloat and fulfill maturing obligations, the 2018-19 budget on April 27 reportedly envisages record-high borrowing in one fiscal year, $13 billion, a dubious distinction. Last year, the figure was $10.4 billion, but in only eight months the government has guzzled $7.3 billion, and during its nearly five years in action, or inaction, the country’s external debt is projected to reach $93.2 billion from $61 billion in 2013 by June! The World Bank on Sunday in its report titled, ‘South Asia Economic Focus Spring 2018’, also pinpointed Pakistan’s dangerously widening macroeconomic imbalances, despite anticipated 5.8 percent GDP growth in 2018, and urged reforms implementation to restore and preserve stability and sustainability. Unfortunately, it is the vulnerable common people who bear the brunt of government incompetence and indecision.
