Ayesha Saba

The resumption of the International Monetary Fund loan programme for Pakistan is expected to stabilise its economy but the policymakers will need to take more effective steps for sustainable growth of the national economy, WealthPK reports. The political uncertainty and rift among politicians can be cited as major reasons for the economic instability in Pakistan. Political stability and a peaceful business atmosphere are basic requirements for attracting investment.

Dr Ashfaque Hassan Khan, a leading economist and principal of the National University of Sciences and Technology (NUST), told WealthPK that IMF’s loan is harmful to the economy of Pakistan in the long run. “The IMF programme is just for stability. It is not for sustainability,” he added. He termed the programme just a booster to stabilise the economy for a very short period of time. He feared that the IMF’s loan would affect the economic growth and development of the country in the long run.

“Instability is poisonous for any economy. Investors become fearful and raise their hands when they see uncertainty in a particular region. A decision won't be made until things settle down, irrespective of whether it is domestic or foreign investment. Growth is affected by a dip in investment,” said Dr Ashfaque. He disagreed with the government’s assertion that tough decisions are being taken to put the economy back on track of progress. He said that political instability is causing economic instability in the country.

“There is no reform agenda and no sane voice to unite the political leaders and steer the country out of the current economic morass. Political leadership must realise the gravity of the situation and take immediate corrective measures to boost the economy on a sustainable basis,” said Dr Ashfaque.He said that in the past, especially in the period from 2013 to 2016, Pakistan did not need to approach IMF for a loan because its current account deficit was less than $2.5 billion, which was equal to only one percent of the Gross Domestic Product at that time. He added that it was considered an ideal situation for a developing country.

Dr Ashfaque claimed that the enforcement of the IMF policies has never improved the economy of Pakistan. He said that the people of Pakistan need to understand that it is a short-term approach. “Instead of seeking loans, we need to bring investment into the country. To improve and fix our economy, we must learn how to live without the IMF programme. Nobody can improve and fix it for us, we must do it ourselves,” he told WealthPK.

Credit : Independent News Pakistan-WealthPk