The government is banking its economic policies on greater financial assistance from the world donor agencies, including the Asian Development Bank to achieve 7 percent growth in the gross domestic product during the next fiscal year.Finance Minister Ishaq Dar is on forefront in knocking one door after the other to get loans, a financial strategy introduced by the Pakistan People’s Party government to run the country’s affairs. The loans are piling up, but growth is lagging behind hardly five percent which is one of the lowest in the region. Under the infrastructural financing package of the bank, the government is currently receiving $2 billion a year and the learned finance minister seeks the donor agency to add another $500 million to it.It is very difficult to understand who told the government policymakers that loans are better than investment. Though some pseudo economist regard foreign investment as another ‘cruse’, but the loans are even the worst option as it leaves the country in the quicksand of debts. No one is able to tell the nation why loans are the only option, the lion share which always goes to undisclosed destinations.
No doubt the foreign loans are a necessity in certain situations, but the economy based on loans will be like a house of cards. Why the government agencies fail to understand that they are mortgaging the nation to foreign institutions which have emerged as the new colonialists of the modern era. Providing loans is the business of the international financial institutions and they are ever ready to extend loans. The trouble is that they attach strings with the approval of loans. Loans under tough conditions only add to burden on the already under pressure economy. The ADB has committed $1.2 billion for the National Disaster Risk Management and $200 million has already been received by the country. The officials, on the other note, spend millions of rupees hard earned taxpayers’ money on foreign tours to meet the officials of the donor agencies. The finance minister is looking to hold multilateral meetings with officials of the ADB, Asian Infrastructure Investment Bank and Japan International Cooperation Agency to seek further assistance. No one knows when the financial managers will be able to prove their mettle.
The real issues of the economy are energy crisis, simplification and enhancement of tax system and business friendly environment. Unless these issues are resolved, the economy would continue to face trade imbalances, financial constraints and low foreign investment.
