Pakistan Economy: Are we heading towards another IMF package

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Pakistan Economy: Are we heading towards another IMF package

ISLAMABAD – Pakistan economic conditions are not as well as depicted by different government departments and organisations. The three major contributing factors are falling exports, falling remittances and low investments.

The Pakistan Economy Watch (PEW) on Sunday said exports, investment and remittances continue to fall hitting forex reserves which will result in another IMF loan.

Continued fall in exports since three years despite efforts of the government and private sector will result in lost export markets, it said.

Exports are falling while imports have gone out of control due to liberal import regime which is creating serious problems for economy, said Dr Murtaza Mughal, President PEW.

The export officials waste time and money and later blame energy crisis to absolve themselves of all the responsibility, he added.

With ever-increasing imports, the trade deficit in the first nine months of the current fiscal year reached $23 billion.

Exporters have been demanding that the rupee should be depreciated to boost exports but government was not convinced of the exporters’ argument.

It may be mentioned that textile is a vital part of our economy which comprises 55 percent of total exports. Pakistan’s total export was used to be 25 billion dollars out of which 13 billion dollars plus was textiles share. Now exports has been reduced to 20 billion dollars with textiles export reduced to 11 billion dollars.

In the past, the government depreciated the local currency to support exporters, but the move did not yield desired results therefore policymakers are not ready to repeat the mistake which is laudable.