Five highest export earning sectors of the economy warned the federal government that they would launch a countrywide protest until and unless the government reinstates the zero-rated regime in the budget 2016-17 namely textiles, carpets, surgical goods, sports items and leather. Data suggests extremely disturbingly that the Dar-led Finance Ministry is increasingly relying on two sources of foreign exchange earnings to strengthen the foreign exchange reserve position: remittance inflows and borrowing. Remittances, data suggests, have peaked and at best would be sustained and at worst begin to decline in months to come. This assessment is based on the decline in remittances of other South Asian countries, including India and Bangladesh. Borrowing is costly and the International Monetary Fund mission leader under the 6.64 billion dollar Extended Fund Facility acknowledged in February this year that our foreign exchange reserves are mostly debt enhancing.

What is an additional source of concern is the fact that the government borrowed 1.4 billion dollars from foreign commercial banking sector in the current year against the budgeted 200 million dollars; and the acknowledgement by the government during a briefing to the Senate Standing Committee on Finance that it took exemption from Public Procurement Rules Authority (PPRA) to procure commercial loans of 1.86 billion dollars during the Sharif administration. This last acknowledgement has raised the hackles of independent economists given that any government's procurement of billions of dollars of short-term loans is a significant boon for the entity from which the loan is procured; and without adhering to PPRA rules charges of lack of transparency, accountability and most importantly nepotism would naturally surface and gather momentum.

Economists the world over are agreed that the most beneficial way to generate foreign exchange reserves is through an increase in exports - be they of services or goods. And here the Sharif administration has performed extremely poorly given the decline in exports in recent months because the cause is not external to the system, as repeatedly claimed by the Dar-led Finance Ministry, but because of flawed economic policy decisions that continue to this day.