2 weeks Ago By Areeba Haroon
Pakistan is a developing country whose economy is heavily reliant on debt. In the first eight months of the fiscal year, the federal government’s debt reached an unprecedented level. According to a State Bank report, by November 2024, the central government’s debt had exceeded Rs 70,366 billion—the highest in the country’s history—highlighting the dire consequences of flawed economic policies.
Over the course of a year, from December 2023 to November 2024, the federal government’s debt increased by Rs 6,975 billion. These figures clearly indicate that the current incompetent and corrupt leadership lacks a concrete plan to stabilise the economy and is merely resorting to temporary, ineffective measures. The Pakistani economy and financial system are burdened by mounting debt.
The government continues to take out more loans to repay existing debt and reduce the budget deficit. Instead of relying on borrowing, the government should focus on cutting non-developmental expenditures, reducing the import bill, expanding the domestic economy, and increasing exports. Without implementing these strategies, Pakistan will not be able to escape its economic crisis.
Modi’s Kashmir delusion Currently, state-run businesses incur losses of Rs 850 billion annually, which the government covers. These loss-making entities should be privatised. Until steps are taken to expand the domestic economy, financial challenges will persist.
Meanwhile, a stark contradiction emerges: just recently, the salary of each member of the Punjab Assembly was increased from Rs 76,000 to Rs 400,000. The salaries of provincial ministers rose from Rs 100,000 to Rs 960,000, the Speaker’s salary increased from Rs 125,000 to Rs 950,000, and the Deputy Speaker’s salary went up from Rs 120,000 to Rs 775,000. Similarly, parliamentary secretaries’ salaries rose from Rs 83,000 to Rs 451,000, special assistants’ salaries from Rs 100,000 to Rs 665,000, and advisors’ salaries from Rs 100,000 to Rs 665,000.
This raises an important question: has the government ever increased ordinary citizens’ wages at such a rate? Has inflation affected the ruling class, whose wealth is multiplying exponentially? Govt launches 6th round of mass deworming campaign It is also worth questioning why the PML-N, PPP, and PTI—parties that publicly criticise one another—have all colluded in this exploitative system. Their public disagreements are merely a facade to mislead the nation, while in reality, they are all beneficiaries of state privileges. Other nations, such as China, India, and South Africa, have successfully reduced their reliance on international financial institutions by diversifying their sources of funding.
China has issued debt in multiple currencies to mitigate currency fluctuation risks, while India has used foreign currency bonds to lower borrowing costs. South Africa’s issuance of Sukuk bonds has demonstrated the importance of alternative financial instruments, particularly those that adhere to Islamic principles. Can Pakistan not adopt a similar approach? To revive the economy, the government must declare an end to the interest-based financial system, renegotiate agreements with the IMF, restore the State Bank to national control, eliminate non-developmental expenses and the VIP culture, and bring back wealth stashed in foreign accounts.
If the government is serious about saving the country from economic collapse, these steps must be taken without delay. IHC announces new administrative changes with transfer of judges from 3 other high courts Pakistan has a significant demographic advantage, with 62% of its population being young. The government should prioritise equipping the youth with skills that will enable them to find employment both within the country and abroad.
MUHAMMAD IMRANUL HAQ, Lahore. Tags: record increase federal.
