26/10/2019
Pakistani Economy: Is It Really Becoming the Worse Than Ever?
The economic crisis of Pakistan is not a new thing to talk about. The current PTI government inherited a torn economy with diminishing foreign exchange reserves, decreasing exports and increasing trade deficit and current account deficit, high inflation and soaring circular debts. The current government has undertaken bold and unpopular measures to lift the economy. After one year, the economy has started showing signs of revival on several fronts. However, most of the mainstream media is not highlighting this progress.
So, the question arises is it really in a bad position than it was in the previous governments. Here is the truth, the situation is bad but not as bad as it is portrayed. The economic indicators are showing improvement and as a matter of fact, the economy cannot be revived overnight. The current account deficit has reduced to 41 months low by 80% from $1.27 Billion to $259 Million in September. This decrease will help Pakistan in stabilizing its foreign exchange reserves along with controlling its balance of payment crisis.
According to the statistics, the imports have declined by 18% in September as compared to the same month in the previous year. There is a slight improvement in the exports by value and a 5.9% increase in quantity. The major increase is due to the textile industry which has recorded profits for the first time in a decade. The imports have declined by 18% and are mainly due to the high rate of duties imposed by the government to facilitate and promote domestic production. The foreign remittances have also increased by 17% due to reformative policies to counter money laundering and unauthorized means of money transfer. Due to these indicators, the trade deficit has declined by 15% in the year 2018-19. Moreover, the foreign direct investment has also increased by 111% this September as compared to the same month in the last year. The investment stood at $385 Million which is the highest in the last 26 months.
The World Bank has recently released the ‘ease of doing business' rankings, according to which Pakistan has shown significant improvement by 28 places. It is previously ranked at 136th and now it is standing at 108th among 190 countries. This comes as a result of the business-friendly policies of the current government. The government has started reforms in the economic institutions which has now started bearing fruits. All these indicators show that the economy is progressing positively. The situation has started to improve and it’s the responsibility of the media to highlight the progress and clear the air of economic uncertainty.
Writing Credit: Umair Riaz Sipra
