by: Ch. Muhammad Natiq
Dear Independent Economists and Policy Practitioners,
Following is a summary of the very serious predicament in which we find ourselves today:- Corrupt Pakistani governments taking huge loans from International Financial Institutions which have been recycled back to these countries. These have resulted in increasing
the prices of gas, electricity and petrol, giving rise to an increase in inflation, particularly food inflation. There is non-availability of water and electricity due to no investments in these sectors due to IMF conditionality on reduction in government expenditures for the last three
decades.
The SBP has been increasing the lending rate as an anti-inflationary measure in Pakistan, where inflation is not due to demand-pull factors, but is on account of cost-push factors and cartelization of the economy. – Government of Pakistan’s only preoccupation during the last thirty years has been on servicing debts. Food and medicines have been snatched from the people of Pakistan to service debts. – Successive devaluations have not increased our exports, and what reduction in import demand was achieved increased the cost of production, resulting in deindustrialization. But devaluation has raised our debt burden, making our exports available at low prices and
increased the incomes of those drawing their salaries and pensions in $s.
I have formulated an alternative to the IMF and informed those in the corridors of power not only that alternatives are available, but are superior to the IMF model. Instead of being recessionary like the IMF strategy, my model is expansionary. My alternative is also more
equitable as it lays the cost of adjustment on wealthy people, unlike the IMF strategy which is laying the entire burden on the poor and the lower middle classes. In spite of my loud and clear message that superior alternatives are available, there is no interest in the corridors of
power for my alternative.
There is no political will on the part of those who are brought to power by the US-UK to opt for superior alternatives. They want one that has the US stamp of approval and will never go for a better alternative because the IMF strategy is very successfully leading to the economic meltdown in Pakistan and many other countries. Moreover, negotiations between world powers and Pakistan on giving and take between nuclear assets and $s require that there should be no alternatives. How can Pakistan be allowed another route which is safer, can bring prosperity and which does not entail the exchange of nuclear assets with $s.
Turning now to the political crisis. Successive Pakistani governments have succeeded in isolating Pakistan. Pakistan has been used for serving alien interests and exploited economically, politically and strategically. We were denied development for the last 75 years
and when China initiated the China-Pakistan Economic Corridor (CPEC) there is great uneasiness and attempts to sabotage it by India, the US and the UK. – Pakistani government did not allow strategic and economic ties to be strengthened with the Peoples Republic of China, the Russian Federation, regional countries and Pakistan’s allies and trusted friends. This will have a serious bearing on our security as western powers isolate a country before taking punitive action against that country.
On the other hand, the Indian government has used its diplomatic skills to establish strategic relations with the US, UK, Australia, and Japan as well as maintain its past relationship with the Russian Federation to get cheap petrol and pass on the benefit to the Indian people. Add to this the constitutional and political crises creating political instability, the constant bickering between the politicians, politicians and the establishment leading to people losing hope, resulting in the flight of capital, uncertainty, loss of institutional credibility, etc.
This bickering also resulted in diverting attention from the serious issues afflicting the state. The deteriorating law and order situation resulting in killings of Pakistani citizens, armed forces, Chinese citizens, bomb explosions, etc. have intensified during the last few months. – Successive Pakistani governments have failed to resolve the serious crises afflicting the state of Pakistan. They are composed of US-UK nationals, Pakistani nationals on the payroll of International Financial Institutions and foreign agencies, those that have leaked Pakistan’s state secrets, economists who have been pushing economic policies that have failed to deliver for the last 30 years and those with serious corruption charges levelled against them.
Can such Governments take the country out of its present predicament? Do they have the willpower and the ability to resolve Pakistan’s economic, constitutional, political and social crises? They are in total connivance with the countries that are pushing Pakistan towards
economic collapse. They are planning to go to the IMF again in 2023 in spite of the fact that our debts have become unsustainable. This means that if we borrow more money Pakistan will default on its payments.
The only way to save Pakistan is to establish a national government that is composed of competent technocrats that are not affiliated with the International Financial Institutions, are not on the payroll of foreign governments, are not dual nationals, and don’t have corruption charges against them and have not disclosed Pakistan’s state secrets. Such a government will be able to get us out of the present economic, political and social crises. Only such a government can save Pakistan.
If you agree with our concerns pl join us to contribute to get Pakistan out of this quagmire.
Writer of Dr Shahida Wizarat,
President Independent Economists and Policy Practitioners,
Website: https://indepp.org/ Email address: info@indepp.org
