On Friday, a former president of the Islamabad Chamber of Commerce and Industry (ICCI), Dr Shahid Rasheed Butt, said the political upheaval and other factors had destroyed the country’s economy. HE SAID THAT the IMF’s program is on hold, foreign exchange reserves are at around $4 billion, and Pakistan is due to pay $3.7 billion next month, with the risk of default looming. In these circumstances, it won’t be easy to provide relief to the public and the business community in the forthcoming budget.
Shahid Rasheed Butt said in a statement today that Pakistan will somehow manage payments of three billion and seventy million dollars. He added that it would be easier for Pakistan to collect 34 billion dollars with the IMF programme. Still, Pakistan will need thirty-four billion dollars next year to repay foreign loans and interest.
The business leader noted that the stock market has decreased by thousand and forty-six points in two weeks, while exports have decreased by 11.7% in ten months. Textile exports have fallen by two billion dollars, and a decrease of six billion dollars is expected in the year’s exports.
Mr Butt said that a decrease of four hundred billion rupees had been recorded in tax revenue and a thirteen percent decrease in remittances during the last ten months.
Production of major industries has fallen by 25% leaving millions jobless, while interest rates are at 21%, which is ruining businesses. Presently, banks are not lending to the private sector because they are getting 22% interest from the government, affecting the economic system.
Shahid Rashid Butt said that in the last ten months, there had been a decrease of 18% in oil imports, which is proof of the economic slowdown. Meanwhile, inflation has increased by more than 36%, which has increased the government’s expenses.
The government is under pressure to increase the salaries and pensions of government servants and hike the minimum wage, which will increase financial stress. Due to the government’s reckless behaviour, the risk of default is rising, due to which people are shifting their savings to dollars, damaging the economy.
Despite the serious challenges, the government will never tax shopkeepers and the rural elite.