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New Delhi: Pakistan is currently grappling with an economic crisis, marked by skyrocketing inflation, a widening trade deficit, and a rapidly devaluing Pakistani rupee. The current economic crisis is being compared to past economic downturns in the country, such as the crisis of 2008 and the one in late 90s, which had a severe impact on the country’s economy and the lives of Pakistani citizens.
According to data from the Pakistan Bureau of Statistics, inflation has risen to over 11% in the past year, driven by rising food and energy prices. The trade deficit has also grown to $37.6 billion in the last fiscal year, and the rupee has lost nearly 30% of its value against the US dollar in the past year. Since the value of the currency is directly proportional to imports and exports, the devaluation of the Pakistani rupee has made imports more expensive. This has increased pressure on the country, and has also impacted the lives of citizens as it’s increased their cost of living.
The economic crisis has been exacerbated by the COVID-19 pandemic, which has led to a decline in economic activity and increased uncertainty. This is a common trend that countries have been facing due to the pandemic, which has regressed development and the quality of life. Citizens are struggling to make ends meet due to high unemployment levels and rising costs.
Leaders in Pakistan have been sounding the alarm about the crisis, with former Prime Minister Imran Khan warning that the country is facing “an unprecedented economic crisis” and calling for urgent action to address the situation. “The devaluation of the rupee, rising inflation, and the widening trade deficit are all serious concerns that we must address if we are to stabilize the economy,” he said.
The government has taken a number of steps to address the crisis, including seeking financial assistance from international organizations such as the International Monetary Fund (IMF) and the World Bank. They have also implemented austerity measures, such as cutting government spending and increasing taxes, to reduce the budget deficit. As well as these measures, the Pakistani government is formulating a plan to boost exports and reduce imports, as a way to improve the balance of cash inflow.
A series of measures to uplift the impoverished have been announced by the government. These measures include cash transfers and subsidies on essential goods. The government is also implementing a strategy to reduce corruption within its system and increase the collection of taxes.
Finance Minister Shaukat Tarin said that the government is taking all necessary steps to address the current economic crisis and to put the economy on a sustainable path. He acknowledged that the government needs the support of the international community and the cooperation of all Pakistanis to overcome this difficult challenge.
However, some experts argue that the government needs to take bolder steps to address the underlying issues, such as increasing tax collection and reducing corruption, in order to put the economy on a sustainable path. The experts also suggest that the government should focus on increasing its own revenue rather than relying on external loans.
Despite the economic crisis and the backlash Pakistan is facing due to it, if the strategies declared by the government are appropriately executed, the country has a great potential to overturn their financial depression. If suggestions made by experts are taken into account, the government can create a sustainable economic growth environment for Pakistan.
