Former Finance Minister Miftah Ismail said the coalition government was unaware of the full scope of the current economic crisis, JEE News reported on Friday, stressing that Pakistan “is facing a continuous crisis”.
Miftah – speaking during a pre-budget debate titled ‘Pakistan’s Fiscal Crisis and Way Forward’ at Saleem Habib University – said that Pakistan’s economic problems are due to the International Monetary Fund (IMF). No, but because of “consecutive leaderships. The country”.
“Pakistan should not be where it is now; two million shopkeepers pay Rs 30,000 in tax,” he warned, warning that the nation would have more economic problems, and “we should learn from them”.
‘Majority issues are self-inflicted’
Commenting on the delay in revitalizing the IMF programme, he reiterated that Pakistan needed the IMF for the 24th time to avoid default.
Miftah said: “Pakistan is going through a very difficult economic period and the nation does not have the resources to repay its debts.
The former finance minister said that we have to go for the IMF program, if we don’t go, we will default and nobody in the world will give us a loan.
He said that most of the problems are actually self-inflicted. However, breaking out of the economic spiral will take some time.
Pointing to the revenue shortfall, the former finance minister said the country needed to take new loans to pay interest on previous loans.
He added that when a country borrows to pay off previous debts, that country’s debt becomes unstable.
Minimum wages must be raised
Regarding the upcoming budget, the former finance minister suggested that the minimum wage – currently Rs 25,000 – should be increased to keep pace with the rampant rate of inflation.
He pointed out that “For the past 75 years, 90% of Pakistanis have experienced the effects of inflation; yet, today even 10% of the middle class and elite are facing price hikes.”
Pakistan’s consumer price index-based inflation rose to a record high of 36.4 percent in April from 35.4 percent in the previous month. The increase in inflation was due to the increase in food consumption during the devaluation of the currency.
He said that inflation rate in Pakistan is higher than India and Bangladesh. He said that not all inflationary pressures around the world could be attributed to the rise in prices, adding that Pakistan’s policy decisions were flawed.
Highlighting the need to increase provincial competition for better performance, the former finance minister demanded that more federal powers be transferred to the provinces.
He claimed that since America adopted this strategy, the economies of its states improved.
Miftah suggested that there should be a meeting between all the political stakeholders of Pakistan to discuss the best course of action to get the nation out of this current economic crisis.
