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July 12, 2020

Four new records

Opinion

July 12, 2020

Record-breaking increase in public debt and liabilities. On the 18th of August 2018, Imran Khan took the oath of the prime ministerial office. As of the last day of June 2018, total public debt and liabilities stood at Rs29.8 trillion. The latest figure from the State Bank of Pakistan (SBP) puts our debt and liabilities at a whopping Rs42.8 trillion. Over the past 21 months, we have taken on additional debt of Rs13 trillion (this is the net figure after all repayments during the 21-month period).

Lo and behold, over the past 21 months, our government has been taking on an average of Rs619 billion worth of additional debt a month, every month (this is the net figure after all repayments). This is a new record. No government in the past 73 years has taken on additional debt of Rs619 billion a month, every month. Lo and behold, over the past 630 days, our government has been taking on an average of Rs20 billion worth of additional debt a day, every single day (this is the net figure after all repayments). This is a new record. No government in the past 73 years has taken on additional debt of Rs20 billion a day, every day.

The last record in increasing our public debt and liabilities was held by the PML-N government. The PML-N government took additional debt of Rs13 trillion over a period of five years (we have now added Rs13 trillion in 21 months). An additional debt of Rs13 trillion over a period of five years means additional debt of Rs216 billion a month, every month (as opposed to Rs619 billion a month, every month). Or, additional debt of Rs7 billion a day, every day by the PML-N (as opposed to Rs20 billion a day, every day).

Record-breaking increase in petroleum prices. On June 26, the “federal government decided to increase the price of petrol by Rs25.58 per litre” in one go. That day the base price for oil was jacked up from Rs23.99 per litre to Rs45.86 per liter – a 91 percent increase in one go. That is unprecedented. The PTI government broke all previous records. Intriguingly, the tax component only went up from Rs41 per litre to Rs44.55 per liter meaning that the government did not make much out of the historical increase. Interestingly, on June 11, Ogra, the regulator, had “imposed a penalty amounting to a total of Rs40 million on six Oil Marketing Companies (OMCs).” On June 27, the same OMCs made Rs16 billion.

Record-breaking decline in GDP. Fiscal 2020 is the first fiscal year after 1952 to have recorded a negative growth in our GDP. This year a 68-year record has been broken. According to the UNDP, “Pakistan needs to generate 1.3 million additional jobs on average every year….” Negative growth means millions will be left unemployed.

Record-breaking budget deficit. The government has itself estimated its budget deficit at 9.1 percent of GDP or a colossal Rs3,800 billion. The last record was set in 2012.

Fact 1: On the 25th of July 2018, a total of 16.9 million voters voted for PTI for a 5-year mandate. The PTI has a legal right to rule the country for 5five years.

Fact 2: Almost 40 percent of that five-year mandate is over and according to Fawad Ch, the PM’s vision has not been implemented because of severe infighting.

The writer is a columnist based in Islamabad.

Email: [email protected] Twitter: @saleemfarrukh