Sherry targets government over alarming external debt

ISLAMABAD  –  Vice President of Pakistan People’s Party Senator Sherry Rehman Tuesday slammed the government over Pakistan’s mounting external debt.  

In a statement, the lawmaker said: “This alarming rise in our external debt shows the downward trajectory of the government’s lackluster economic vision.”  

The country’s external debt has swollen to a whopping $83 billion. Rehman said: “The gross public debt now stands at Rs21.4 trillion or 67.2 per cent of GDP (Gross Domestic Product). The figure was Rs14.7 trillion during the last year of the PPP government. External debt servicing has also gone up from 13 per cent in 2013 to 16 per cent in 2017 which is taking up 30 per cent of the country’s crucial export receipts and there are no signs of any policy response. I cannot comprehend how this is not alarming to anyone in the Finance Ministry”. 

She added: “This disturbing development could lead Pakistan into a dangerous rabbit hole of debt since our capacity to repay has significantly weakened and we will soon need external financing. This crisis did not happen overnight, it has been going on for four years and the government still refuses to take note of the gravity of the situation.” 

Pakistan, she said, had lost $2 billion of its foreign exchange reserve in the first quarter of the Financial Year 18. 

According to the legislator, Pakistan’s economic figures pointed towards the fact that the government’s economic policies had failed. “Our exports took the brunt of poor policies which has led to the vulnerability of our balance of payments. From overvaluing the rupee which weakened the global competitiveness of our exports, to the liquidity issues that forced exporters to take out loans from banks, we are now witnessing its damaging repercussions,” she said. 

The PPP leader said the government’s Rs 180 billion export package “alone is not sufficient to balance our trade unless the government does a complete overhaul of its ruinous economic policies.”  

She said the government was yet to make any progress for crucial structural reforms despite warnings from the International Monetary Fund and the World Bank.  

“During the campaign season, PML-N (Pakistan Muslim League-Nawaz) promised groundbreaking changes in the economy. We did not expect that setting up Pakistan towards the path of a bailout is what they meant by that,” she added. 

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