The Senate has raised the question of growing loans which are piling up to an alarming proportion, lending credence to the fears that the trend could lead to a situation where debt servicing will become a major issue for the nation. On a call attention notice in the upper house of parliament, PTI Senator Shibli Faraz criticized the government for its growing appetite for acquiring more and more loans in utter disregard to its fiscal responsibilities and debt limitations.The members also expressed concern over the reports that the government has planned to get another Rs 1.6 trillion loan during the third quarter of the current fiscal year. This is the unfortunate part of mismanagement and mal administration by the government policymakers who are fully depending upon loans to run the country’s affairs. The previous Pakistan People’s Party government had discovered a novel way to run the country’s affairs by taking loans and shifting the burden on the next government. A government minister came to the rescue of the government, saying external debts of $12 billion,which were taken by the previous government, have been repaid by June last year.
The countries in the region have introduced new policies to improve their economies which are now successfully increasing their gross domestic product. Pakistan’s only achievement is the China Pakistan Economic Corridor butthe hostile forces are active to make this mega project controversial. Increasing the volume of loans means a time will come when debt servicing will eat up all the economic gains and the government would have to take new loans to pay the old debts. The government minister admitted that the debt-to-GDP ratio has increased by 1.1 percent during the first three years of the government. However, some economic indicators have also shown signs of improvement during the period and it is hoped the country will achieve the growth of 5.2 percent projected by the World Bank in its recent report.
The country is facing domestic debt of Rs13.17trillion which wasRs9.49trilliononly three years ago while the external debt has shot up to $57.7billion from $48.1billion during the period. The volume of internal and external debt have reached Rs19.68trillion at the end of the previous fiscal year from Rs14.3trillion three years ago.The current government has less than two years to show its performance and fulfill the promises the leadership had made during election campaigns. It is easy to make a promise but difficult to fulfill it. The economy has still not been put on the right track and unless prudent policies are devised, loans will not serve any good to the economy.