KARACHI
Chairman of National Business Group Pakistan, President of Pakistan Businessmen and Intellectuals Forum, President of All Karachi Industrial Alliance, Chairman of the FPCCI Advisory Board and President and former provincial minister Mian Zahid Hussain, on Monday said there had been few examples in the economic history of the country that the exchange rate is stable, inflation and interest rates are decreasing and the current account is in surplus.
He said the government deserves praise for improving the economy, but much more needs to be done to ensure sustainable economic growth. Mian Zahid Hussain said that efforts are needed to increase exports and remittances so that the debts can be cleared and the country can be put on its feet.
Talking to the business community, the veteran business leader said that we will have to pay the debts of one hundred billion dollars in the next four years. To pay these debts, the government must allocate twenty-five billion dollars annually, or 2.08 billion dollars per month, in addition to the existing resources. He said the government can restructure the debts, increase exports, boost remittances, and enhance tax revenue.
The business leader said that if income is not increased in these ways, more loans will have to be taken to repay the existing loans, which are becoming increasingly complex and expensive.
He observed that if things are not controlled now, keeping the exchange rate stable will be challenging, resulting in economic instability that the country cannot afford at this point.
Mian Zahid Hussain explains that recently, to obtain loans from the IMF, the dollar had to be borrowed at very high commercial rates. This has increased the pressure on the entire system.
He said keeping the exchange rate constant will reduce import expanses and external debt. If exports and remittances cannot be increased enough, we must rely on foreign loans, rollovers, and loans to prevent the rupee from falling.
He noted that economic stability based on debt is temporary and increases suspicion, speculation, and uncertainty in the market. Mian Zahid Hussain further said that for absolute economic stability, we must increase our income instead of borrowing; otherwise, things will start worsening soon.
To increase revenue, it is also essential to focus on sectors that pay little or no taxes, as existing taxpayers cannot be burdened more.
He informed that in 2023, imports were 53.2 billion dollars, and exports were 30.1 billion dollars, which means there was a deficit of 22.1 billion dollars.
This is a big problem that can be resolved by focusing on sectors other than textiles. He said an increase in the skilled workforce is necessary to increase remittances as the export of unskilled labour is not expected to benefit the country significantly.
