Princeton economist Atif Mian has issued a stark warning that the countryis on the brink of an unprecedented financial crisis, driven by a complexweb of challenges. His analysis highlights the gravity of the situation, asPakistan grapples with severe economic difficulties stemming from multiplefactors.
Mian, a Pakistani American scholar, points to the alarming rise in bothdomestic and external debts, unsustainable pension liabilities, and thedeteriorating power sector as key contributors to the country’s economiccollapse.
His assessment paints a grim picture of Pakistan’s financial health,suggesting that the situation is extraordinarily dire, even by globalstandards. According to Mian, Pakistan’s economic troubles are a clearexample of fiscal mismanagement, positioning the country as an outlier onthe world stage.
“Pakistan’s domestic and external debts, its unfunded pension liabilities,and the zombie power sector have pushed Pakistan into a deep fiscal crisis.It is hard to think of another country in as bad a shape,” Mian stated in acomment shared on his official X account.
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In response to Mian’s analysis, Asad Rizvi, a former Treasury Head at ChaseManhattan Bank, called on the economist to propose practical solutions tohelp the country navigate its economic challenges. Rizvi also encouragedMian to explain how advanced economies with high debt-to-GDP ratios manageto stabilize their financial systems in similar circumstances.