The business sector on Sunday encouraged the senior leaders of all major political parties to get together, set aside differences, and develop a workable plan to lead the nation out of the current troubling economic crisis that is afflicting the economy.
Meher Kashif Younis, the Coordinator to the Federal Tax Ombudsman and Minister of State, stated that the deepening political unrest is one of the primary causes of economic instability in a speech to a delegation of industrialists and traders led by President of the Pakistan Furniture Importers Association Mian Faryad Ahmad Raza. He noted that the depreciation is taking a heavy toll on stock investors, the currency markets are crying out for dollars amid a liquidity crunch, and the
He claimed that domestic political unrest, a soaring current account deficit, diminishing dollar inflows from multilateral and bilateral lenders, as well as declining foreign investments, put tremendous pressure on the rupee and foreign exchange reserves over the past few months, sparked rapid inflation, necessitated the State Bank to raise borrowing costs to multi-year highs, and damaged investor confidence in the nation. He claimed that political stability is a universally acknowledged requirement for a strong, sustained economy that ensures the nation’s survival.
Meher Kashif Younis claimed that despite numerous measures implemented by the government and the SBP since the last quarter of 2021 to curb imports, Pakistan’s current account deficit has increased to $17.4 billion, or 4.6 percent of the size of the GDP, during the past fiscal year. The increase in exports and remittances from expatriates, he claimed, did contribute to closing the gap somewhat, but higher global commodity and oil prices meant Pakistan would have to spend more on its energy and other imports, more than doubling the cost of oil imports to $2.9 billion in June from $1.4 billion in May.
Meher Kashif Younis stated that Pakistan’s external sectors may likely improve in the medium term with the hope that the IMF releases funds soon, unlocking further loans from other multilateral and bilateral creditors. However, given the current situation, it is not a long-term fix. Instead, we need to maintain our economic policies, regardless of political upheaval.
The serious political instability currently being experienced, he continued, makes him fear that the top political figures won’t be able to put aside their differences and work together to save the fragile economy from total collapse in the interests of the larger national goals. They also might not be able to address structural barriers to exports and FDI.
He advocated for maintaining a total ban on all luxury goods and other products created in Pakistan and made an impassioned appeal to the government and people, in general, to adopt a simple lifestyle by rigidly practicing austerity in accordance with the core precepts of Islam.
