KARACHI: Chairman of National Business Group Pakistan and President Pakistan Businessmen and Intellectuals Forum, Mian Zahid Hussain has said Pakistan’s weak economy is further affected by global conditions and persistent rise in political temperature in the country.
It would be better to resolve the issue of no-confidence as soon as possible as delay is intensifying the economic crisis, he said.
Mian Zahid Hussain said that the government expects a loan from the International Monetary Fund (IMF) but the lender is dissatisfied with the breach of promises which can lead to the termination of its program which would be a disaster.
He said that the termination of the IMF programme will make borrowing difficult for Pakistan from other sources.
He said that in the current unstable situation, investors have suspended their decisions while a large amount of capital is fleeing the country, which is causing the Pakistani rupee to depreciate further.
Flight of capital will result in inflation and further increase poverty, burdening the whole population, he observed.
Mian Zahid Hussain warned that political and economic instability will increase, the US dollar will become more expensive, the rupee will depreciate further and the flight of capital from the country will accelerate and the people would suffer if political issues are not resolved soon.
He said that the foreign exchange reserves were declining. As many as 15 billion dollars have gone out of the country this year, while more than 400 million dollars have been sent out of the country in the month of March.
According to an SBP report, textile manufacturing has declined from 4.1% to 2.9% this year as compared to July-January last year. Food manufacturing fell from 29% to 3.4%, chemicals from 9.2% to 5.4%, pharmaceuticals from 10.3% to minus 3.5%, while automobiles and some other sectors have improved.
Exports from July to January, which were 16.1 billion dollars last year, have reached 20.6 billion dollars this year, but their volume has not increased, but only prices have risen. Imports, meanwhile, rose 49 percent from 32.1 billion dollars to 47 47.9 billion dollars hurting foreign exchange reserves but boosting the FBR revenues.
The current account deficit, which was negative one per cent last year, has risen to 12.1 per cent this year which is worrying, he said.
Copyright Business Recorder, 2022
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