Govt post-polls
KARACHI:
Pakistan’s progress has long been hindered by political uncertainty, leaving the nation at a critical juncture.
However, the upcoming general elections have reignited hope within the business community, anticipating an end to uncertainty and a path towards economic revitalization, regardless of the party or parties that form the post-February 8 government.
Yet, they caution that a weak coalition or hung parliament could further deteriorate the economy, lacking the necessary resolve to address pressing issues.
While talking to The Express Tribune, Ehsan Malik, the CEO of the Pakistan Business Council, and Anjum Nisar, former president of the Karachi Chamber of Commerce and Industry (KCCI), emphasized that securing a new IMF loan program upon the conclusion of the current one in March 2024, and restructuring the existing substantial debt, should be the foremost priorities for the incoming government. These measures are vital to bolster business confidence, stimulate economic activity, and foster sustainable growth.
In separate discussions, the two business leaders cautioned that a fragile government would encounter ongoing political hurdles in securing the new IMF program. Any delay in this process could potentially disrupt the economy, just as it begins to exhibit initial signs of stabilization.
“The next government’s primary agenda should be to secure a new IMF loan program, with debt re-profiling as the secondary priority. These measures must be pursued in tandem to bolster business confidence in Pakistan,” Malik said.
He added that Pakistan was still short of $6 billion to repay the forthcoming maturing debt. “We are to repay a total of $27-28 billion over the next two years. An IMF programme and debt re-profiling can ensure repaying the loans smoothly and on time. This will boost business confidence and continuity.”
They also urged that the new government should continue the policies of the current caretaker government, led by the Special Investment Facilitation Council (SIFC) initiative to ensure growth.
Asif Inam, Chairman of the All Pakistan Textile Mills Association (APTMA), expressed uncertainty regarding the outcome of the February 8 election and the formation of the government.
He remarked that veteran politicians, with four decades of experience, would likely continue their established practices once in power. Conversely, newcomers to politics lack experience and may struggle to deliver results. “Politicians will likely remain inactive,” he noted. “SIFC is the ray of hope. It should remain in the driving seat to lead the nation sail out the ongoing financial and economic crisis,” he said.
Nisar said the elections and formation of the next government would minimise political uncertainty instead of removing it completely.
“The next IMF programme and debt re-profiling would give the required confidence to the business community.”
Pakistan’s entire earnings are being allocated towards debt repayment and interest, leaving minimal resources for government spending on economic activities. “The mandated fiscal discipline under the IMF program is crucial for sustainable economic growth.”
