Ishaq Dar Assures Pakistan Will Not Default, Despite Economic Challenges
Key Highlights :
Finance Minister Ishaq Dar on Thursday assured the nation that Pakistan will not default, whether an agreement with the International Monetary Fund (IMF) is reached or not, as the government has ensured all external payments till December. He made this statement while addressing a session on the topic of the country’s economic challenges under the auspices of the National Security Division and the Islamabad Policy Research Institute under the security dialogue.
The minister stressed that economic security is intertwined with both internal and external security. He added that Pakistan's strategic location and large market make it essential to shift focus from geopolitics to geoeconomics, with emphasis on economic diplomacy, in order to achieve regional connectivity and regional peace. Dar further stated that Pakistan advocates for peace and plays an active role in regional and international platforms like the SCO, SAARC, and ECO.
To create an inclusive and equitable society, the government has increased the allocation for Benazir Income Support Program to Rs 400 billion with 25 percent increase in stipends. In addition, the government has initiated a youth skill development program to encourage entrepreneurship skills among the youth, as well as to enhance employment opportunities.
Dar informed that the government had inherited a bleak economy, which was the result of incompetence and bad governance of the last government of Pakistan Tehreek-e-Insaf (PTI). This resulted in a trade deficit of $ 39.7 billion in fiscal year 2022, current account deficit of $17.4 billion, and foreign direct investment of $1.9 billion. Moreover, the fiscal deficit was recorded at 17.9 percent of the Gross Domestic Product (GDP), while during the period 2018-22 huge amount was borrowed and the circular debt grew to Rs 2,446 billion and public sector debt ballooned from Rs 25 trillion to Rs 44.5 trillion.
The minister said that the government had taken tough decisions and sacrificed its political capital on the supreme national interest, in order to sustain the local economy. These measures included banning import of luxury items, tightening the monetary policy to control rising inflation, and striving to attract investment in the country with economic diplomacy.
He added that the government had also initiated a Kissan program worth of Rs1,700 billion to revive agriculture sector, enhance productivity with modernization of agri-sector and ensuring availability of high-yielding quality seeds of all major and minor crops. As a result of these measures, the country harvested bumper wheat crop during current season, which would enhance farm income.
In conclusion, Ishaq Dar highlighted that economic security is key for Pakistan’s ability to strengthen its national security and continuity of economic growth. He also added that the government is committed to protecting the masses from tough economic challenges and ensuring lowing of input cost and success of its internal reforms.
