Chairman of National Business Group Pakistan, President Pakistan Businessmen and Intellectuals Forum, and All Karachi Industrial Alliance, and former provincial minister Mian Zahid Hussain on Monday said it would be very difficult to run the country without the IMF program because it will be impossible to get more loans without the IMF. He said that old debts will have to be repaid at the rate of 25 billion dollars annually, which will be a nightmare for Pakistan. Mian Zahid Hussain said that the government should present an alternative economic model to the public given the delay in the IMF program.

Talking to the business community, the veteran business leader said that the country’s difficulties should not be increased by making irresponsible statements about the economic situation and instead of political sloganeering, decisions should be taken according to the ground realities.

He said that a strategy should be formulated according to the facts, adding that the current account surplus is welcome. Still, the reason for the improvement in the current account situation is not economic reforms but the reduction of imports from 80 billion dollars to 55 or 60 billion dollars per year.

Restricting imports is a temporary measure to avoid a default that cannot be sustained for long as Pakistan’s GDP has reached record lows, thousands of factories have closed, and millions of people have lost their jobs.

In any case, the current account surplus cannot increase to the extent that Pakistan can repay its debts of 25 billion dollars every year. Almost every sector of the economy has been affected by the measures taken to deal with the current account deficit, inflation, unemployment and economic instability have increased, the output of major industries has fallen by twenty-five percent, and foreign direct investment has declined by 98 percent, he informed.

Mian Zahid Hussain said that millions of people are forced to work for low wages while many industries operate far below their capacity. The market is uncertain due to the risk of default and continued depreciation of the rupee, which is also increasing inflation. Still, on the other hand, the depreciation of the rupee may increase exports and remittances from overseas Pakistanis.

Thirty billion dollars or nine thousand billion rupees are used by Pakistanis annually from remittances, which confronts inflation and poverty.

Mian Zahid Hussain further said that the public and the business community had to pay a heavy price for current account management, which temporarily averted the risk of default. Still, it was shrinking the economy and tax and non-tax revenue of the government. 

Mian Zahid Hussain said that to deal with this situation, immediate reforms in the economy, agriculture and energy sectors are necessary, which can help save almost 20 billion dollars annually, which not only can provide relief to the people but also avert the risk of default.