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EditorialDebt burden: PTI’s broken promise

Debt burden: PTI’s broken promise

The economic scorecard of the ruling PTI is only exposing the government’s inability – rather incompetency – in taking the country out of the crises it is currently facing. The State Bank of Pakistan’s (SBP’s) latest data revealed that the country’s total debt and liabilities have crossed the enormous figure of Rs50.5 trillion for the first time ever in Pakistan’s history. The external debt and liabilities increased by $13 billion (11.4 percent) during the last one year alone. This means until the time of writing, every Pakistani owed Rs235,000, compared to Rs144,000 in June 2018.

Under the leadership of Prime Minister Imran Khan, who recently described the increasing debt as a “national security issue,” an increase of nearly 70 percent in the total debt of the country has been recorded. Courtesy of the government’s growth-oriented policies, as the ruling PTI, just like its predecessors, is running the economy on foreign and domestic loans. And has done little to nothing but rely on remittances to enhance revenues to offset the debt burden.

It is pertinent to note that the latest statistics do not take into account the Saudi loan of Rs3 billion as well as the revival of the $6 billion IMF programme, which will see the first tranche of over $1 billion deposit in the national kitty by early next year. It is then safe to say that the ratio of debt and liabilities to the GDP that is already over 40 percent, is likely to go up to record levels. And here is the catch. The ruling party would like us to believe that the rising debt problem was an issue they had to carry forward due to the ‘corrupt’ governments of the past. But the PTI has added public debt – a direct responsibility of the federal government – of Rs16.5 trillion in the past 39 months. This figure alone is equal to what the last two governments of PPP and PML-N added in 10 years. Perhaps the premier must be reminded that not too long ago – on February 2019 – he had pledged to bring down the public debt to Rs20 trillion. However, it stands at Rs41.5 trillion by September, which is an addition of 165 percent to what the PML-N had acquired in its five-years tenure.

With two years left for the ruling PTI to complete its tenure, the economic situation is likely to get worse. Considering that Pakistan is one of the 50 countries in the world that are facing an imminent debt crisis, our economic managers need to rise up to the occasion and work towards reforms that would help expand our revenue streams and tax net. More importantly, these policies need to be pro-people.

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