Our economy

The external debt is now exceeding $80 billion and the domestic debt has risen by more than three times. The right question which policymakers should ask each other is that whether the country can avoid the borrowing spree that has hugely accelerated during the past four years. The nation is caught in a serious debt trap. The government has been tapping all available avenues for funding – the IMF, concessional financing from bilateral sources, multilateral institutions and commercial borrowing from open market. Even if the prime minister decides not to approach the IMF, his government will be raising expensive borrowing from the commercial sources to bridge the huge trade gap that remains unaddressed. The country also has a plan to float $1 billion in sukuk – Islamic bonds.

The growth achieved during the last few years is externally-driven. The liquidity provided by loans has been squandered on unproductive imports to project a false sense of prosperity. Under the prevailing situation, no one should absolve themselves from the prevalent economic mess. On the other hand, everyone must share the blame for the poor economic management.

Kulsoom Arif (Karachi)