ISLAMABAD: Pakistan’s economy is now in a worse shape on all accounts under the three-and-a-half year rule of PTI led government in 2022 than it had inherited from the PMLN led government in 2018, it has been claimed by a US economist Mian Atif, who was selected by the Imran govt in its first year to serve the country but was later dropped after a controversy.
Renowned Pakistani-American economist Atif Mian stated that the PM was voted out of office by the parliamentarians after 3.5 years; he had inherited a bad economy but leaves it Renowned Pakistani-American economist Atif Mian stated that the PM was voted out of office by the parliamentarians after 3.5 years; he had inherited a bad economy but leaves it in even a worse shape.
"The PTI tenure could be marred by low GDP growth, higher inflation, especially food inflation, average low tax collection of FBR, higher expenditures, rising public debt and liabilities as well as an escalating monster of circular debt. Now the twin deficits known as yawning fiscal deficit and current account deficit are again skyrocketing, especially the current account deficit was again touching a level that was inherited by the PTI government when it had assumed reins of power after winning the 2018 general elections."
Atif said: "There's been zero increase in average income, and Pakistan never got out of the balance of payment (BoP) crisis. The Covid gave temporary respite to BoP crisis as oil imports and domestic demand contracted due to the pandemic, but with pandemic receding, it is back in serious trouble."
He said that the larger failure was an incapacity to understand Pak macro challenges the PTI inherited, a currency crisis that was already months in motion. Yet the new govt had done no planning. Precious time and reserves were wasted with silly schemes, he added.
"When finally external adjustment was forced upon the government, it could have enacted new policies to ensure that Pak: (a) gets out of BoP trouble, (b) gets on a sustainable growth path. But even (a) never happened, (b) had no chance." He raised a question why and replied that because the government policy went for the usual shortcuts: open capital account for speculative portfolio investment, encourage unproductive real estate investment, continue to subsidize an elite-favoring rentier economy, go on foreign begging trips, etc.
"What should have been done was not done, e.g. engineering an ambitious energy-independence policy, without which Pakistan cannot have sustainable growth. This would have required pulling the best renewable energy scientists into the country and giving them discretion and resources. Instead we got the emotional appeal for a dam fund. Growth is serious business. It requires building value-chains inside your country, it requires building capacities of your people, your firms, your government. This basic sense was missing."
It is extremely unfortunate that a government that millions had pinned high hopes on has ended in such colossal failure. Atif added: "I hope those who come next learn from this, and their own past failures."