The government has broken all previous records of borrowing loans from domestic and foreign banks and the Gross National Product (GNP) ratio has touched the dangerous figure of 68 percent. This clearly indicates that Pakistan’s dependence on foreign loans has been going up with the passage of time, despite counter-claims by the government.
The performance of the present government in this sector seems rather dreadful as not only has it been adding to the burden of foreign loans; it has raised the prices of all utilities to a great extent during its nearly five years’ tenure. If one has to trust the figure released by the State Bank of Pakistan, the foreign loan burden has reached Rs 6100 billion and if domestic loans of Rs 8200 billion are added to it, that means the total amount of loan has already crossed the historic level of Rs 15,000 billion. The SBP cites two reasons behind this dismal scenario; firstly; the ever increasing budget deficit and secondly; consistent devaluation of Pak rupee. At the same time, the IMF and the World Bank are exerting full pressure for debt servicing imposing un-bearable conditionalties. There is no other way out except for the government’s financial managers to put their heads together and formulate a viable and workable strategy to take the country out of this economic mess.