In its report, the State of Economy 2015-16, the State Bank of Pakistan has expressed serious concerns over the increasing deterioration of the country’s economy. According to the report, the economy is facing challenges of falling exports, poor spending on the social sector and structural anomalies in the tax systems which has distorted the shape of the economy. The report, however, appreciates the government for achieving the macroeconomic stability, but there is a need to increasing volume of savings and investments. As a matter of fact, the challenges to the economy are real, but the government approach is cosmetic. The policymakers have failed to comprehend the severity of the challenges and could not pay attention to the emerging situation. They are claiming the credit for the macroeconomic stability on basis of loans the government has been able to acquire during its three-year tenure. There is also no point to boast of the foreign exchange reserves which are being kept at a comfortable level on the basis of loans and grants. The country has failed to create industrial surplus and is also facing serious trade deficit. The energy crisis has already proved to be a stumbling block in the way of industrial growth.
So far, the government steps have discouraged the local investors to put their money in any meaningful project. The country has a lot of investment opportunities in every field of economy, but even the local investors are shy of taking any risk what to speak of foreign investors. The lack of coordination and cooperation within various government departments is also an area of concern. There is no driving force to push the policymakers into running mod. Everything is going on a routine pattern and lacks energy and enthusiasm. The political leadership also lacks will or capacity to put the economy on the right track. In this situation, the report from a vital component of the federal government should be taken seriously. The report also points out a daring fact that there is no dearth of capable people in the official hierarchy who are responsive to the glaring economic situation of the country. The political leadership has been extending deadlines one after the other to rid the country of load shedding but the impact of the menace is visible in shape of falling exports. Until the government fixes the situation, the exports will further fall and this will further enhance economic woes of the country in the coming years.
The other countries in the region are also facing the same situation, but their industry is growing and exports are multiplying. It is not difficult to understand that the country is actually lacking political will to manage the economic affairs.
