The prime responsibility of any government is to identify and prioritize the problems facing the state and society of that country. Unfortunately, the ruling elite of Pakistan has never appreciated the real problems faced by the state and its huge population. Today the state of Pakistan is facing a serious economic crisis and the government finds severe challenges to overcome this financial catastrophe.
For the first time in the history of Pakistan, its GDP growth has shrunk to negative 0.50 percent for the fiscal year (2020-2021). According to the Global Economic Prospects Report released from Washington DC, Pakistan’s GDP growth would continue shrinking in the next fiscal year and it might touch negative 0.2 percent of GDP in the fiscal year 2021-22. The provinces and institutions are unable to manage their annual budgets.
The current catastrophic economic crisis situation can be attributed to the bad governance and failure of the government and its economic managers. The government and its economic managers responsible for managing the state’s economy could neither appreciate the looming financial crisis nor take timely measures to avoid the financial meltdown of Pakistan. Resultantly the country is heading towards an economic default.
Then there has been a very high inflation rate in the last two years (2019 to 2021). The inflation had risen to 6.74% in 2019 and reached its peak (11.12%) in 2020. The annual inflation rate in Pakistan accelerated to 11.5 percent in November of 2021 from 9.2 percent in October 2021. In addition, poverty is at an all-time high in Pakistan where the number of poor people is increasing with each passing day as food items and other necessities of life are beyond the reach of the common man.
While the national economy of Pakistan is sliding downwards, there has been an unprecedented mushroom growth of the various cartels in Pakistan. These cartels are controlling the prices and supply of almost all critical food items and petroleum without any governmental check. In most cases, these cartels are part of the government with sitting ministers, MPs, and advisors. Despite investigations and proofs against their deliberate corruption, causing heavy losses to the national economy and undesired short supply of items in the market, they stand unaccountable and scot-free. Similarly, the exchange rate of PKR versus US Dollar (1 USD=179.07 PKR) is the highest in the history of Pakistan. The worst part of the current economic crisis in Pakistan is that this below-average team of economic managers is still being praised by the Chief Executive of the state and ministers are accusing previous governments of their inefficiencies which caused the financial meltdown of Pakistan.
This team of ineffectual is called the financial think-tank of Pakistan holds meetings almost every week, further sinking the economic ship to the deep sea. This state of poor economic fall-out has reached despite huge financial assistance (loan) from the Kingdom of Saudi Arabia, UAE, and many other friendly states. Besides, there has been rescheduling of the loans by IFIs owing to COVID-19.
Restoration of the economy on the path of economic development through immediate and revolutionary measures is most needed to avoid economic default and even for the survival of the state. Nuclear Pakistan with rivalries all around and multiple fault lines within cannot be run like a corporate company nor can it be left at the mercy of the inept and non-serious elite. Therefore, the PM should re-evaluate the governance system of the Government and the performance of economic managers of Pakistan and replace them with an apt, proficient, and experienced team whose focus must be the State of Pakistan and its 210 million masses.
AHSAN MURTAZA
ISLAMABAD
