Sherry rings alarm on rising debt

Islamabad:Pakistan People’s Party Parliamentarians (PPPP) Vice President Senator Sherry Rehman slammed the government over Pakistan’s mounting external debt saying that this alarming rise in external debt shows the downward trajectory of the government’s lackluster economic vision.

“The country’s external debt has swollen to a whopping $83 billion while the gross public debt now stands at Rs. 21.4 trillion or 67.2% of GDP,” she said while commenting on the climbing debt of the country.

Sherry said the figure was Rs14.7 trillion during the last year of the PPP government. External debt servicing has also gone up from 13% in 2013 to 16% in 2017 which is taking up 30% of the country’s crucial export receipts and there are no signs of any policy response. “I cannot comprehend how this is not alarming to anyone in the Finance Ministry,” she said.

She said this disturbing development could lead Pakistan into a dangerous rabbit hole of debt since our capacity to repay has significantly weakened and we will soon need external financing. “This crisis did not happen overnight, it has been going on for four years and the government still refuses to take note of the gravity of the situation,” continued the Senator.

She said Pakistan lost $2 billion of its foreign exchange reserve in the first quarter of FY18.

According to Senator Sherry Rehman, “Pakistan’s economic figures all point toward the fact that the government’s economic policies have failed. Our exports took the brunt of poor policies which has led to the vulnerability of our balance of payments. “From overvaluing the rupee which weakened the global competitiveness of our exports, to the liquidity issues that forced exporters to take out loans from banks, we are now witnessing its damaging repercussions,” she said.

She said the government’s Rs 180 billion export package alone is not sufficient to balance our trade unless the government does a complete overhaul of its ruinous economic policies.“This government is yet to make any progress for crucial structural reforms despite warnings from the IMF and World Bank,” she said.

She said during the campaign season, PML-N promised groundbreaking changes in the economy. “We did not expect that setting up Pakistan towards the path of a bailout is what they meant by that,” she said.