The biggest challenge for newly elected Prime Minister Shahbaz Sharif will be the streamlining of the economy of the country. But it is very much possible that the old tactics would be used to deal with the current financial crises.
According to media reports, the new Prime Minister before the formation of his cabinet has decided to contact the IMF to take a fresh tranche of loan of six to eight billion dollars. It is very much expected that this time the IMF will give loans on extreme toughest conditions, by reviewing the economic situation of the country.
During the last tenure of PDM’s 16 months’ government, the rate of inflation had reached 38 percent, which will further increase due to the harsh conditions laid down by the International Monetary Fund.
The government has given hints to go to the IMF, and if it succeeds to sign the new agreement with the IMF, then it will be the 23rd programme. The story of taking a loan from the international donor agency was started in December 1958 with just 25 million dollars, which has reached to six to eight billion dollars. The increasing debt volume indicates derailing the economy from the right track, which is taking the country far away from its destination of strengthening the economy.
The dreadful sequence of taking loans is never seeming to be stopped. The amount that needs to be repaid is more than the annual GDP of the country. This was due to the very reason that the country’s economy did not enhance but the volume of the debts has doubled during the last decade. If the economy of the country would go up with the volume of the loans, then it would be bearable, but what had happened here in Pakistan was appalling from the financial point of view.
Although it has become the necessity to take loans to run the affairs as well as to reimburse debts at this juncture of time, this is the high time to ponder for the political leadership of the country that the entire system could not be driven on loans. Now the government should think to move towards self-reliance and reduce the dependency on foreign debts.
To achieve this target, the government should introduce economic reforms and launch a programme for restructuring of the several national organizations on a war footing basis. Though putting extra tax burden on the common man is the very easy verdict, but the government would have to take hard decisions by taking back the fringe benefits allowed to the elite class, top bureaucracy and the lawmakers including high salary packages, healthcare facilities at national exchequer, provision of free of cost electricity, petrol and natural gas immediately.
On one side the purchase of new vehicles for the government officials and members of the parliament should be banned for the next five years and on the other hand the job opportunities to the educated youth should be opened at once.
If the government would not take difficult decisions, this time, then the state would have to sell all the profitable institutions on the directive of donor agencies and after passing some more years, there would be a big question mark on the survival of Pakistan.