Pakistan’s debt, liabilities surged by Rs14.4tr in 2 years: Sherry

ISLAMABAD – Pakistan People’s Party Vice President Sherry Rehman yesterday said country’s debt and liabilities had surged by Rs 14.4 trillion in the last two years – up from Rs 29.9 trillion in June 2018 to Rs 44.3 trillion.

The PPP parliamentary leader in the Senate criticised the federal government for failing to tackle Pakistan’s rising debt.

“Over the last two years, the PTI (Pakistan Tehrik-e-Insaf) government has been taking on an average of Rs 20 billion worth of additional debt a day. No government in the past 73 years has taken on additional debt of Rs 20 billion a day,” she said.

She questioned: “Public debt is breaking all previous records, inflation is highest in the region, and circular debt remains one of the biggest challenges in the power sector. Where is our economy heading.”

Commenting on the galloping circular debt, which remains one of the biggest challenge in power sector, the Senator said, Pakistan’s circular debt in the power sector, currently standing at Rs 2219 billion, is expected to swell up to Rs 4,000 billion by 2025. 

The PTI-led government, she said, had vowed to curtail the menace of circular debt. And on the contrary, they have added an addition of Rs1.72 trillion in two years which comes to Rs 71 billion a month, or Rs 2.3 billion a day.

“The country is already facing severe gas shortages. This is expected to worsen in the coming months, especially during the winter season. Is there anything, any sector that this government can manage properly,” she maintained.

She asked why the federal government was celebrating a decline in the Current Account Deficit, adding the “CAD improved mainly due to a historical dip in international oil prices amidst the COVID-19 crisis. During PPP’s time in power, crude oil price was $147/barrel, yet the situation was nowhere close to what it is now.”

She said instead of bowing down to the sugar, wheat, and business tycoons, the federal government must work towards providing economic relief to the poor and vulnerable people of Pakistan.

“It is getting very difficult for the common man to survive during these testing times”, the senator added.

Highlighting lack of parliamentary supervision in the federal government’s economic policies, the senator questioned: “Why is the PTI government not keeping the parliament in confidence when it comes to our economic policies? In any democratic system, the parliament and the Opposition have the right to scrutinize and question the government’s performance.”

Commenting on the importance of revenue collection, the senator said: “Pakistan is one of the countries in the world with the lowest tax-to-GDP ratio. The federal government must take lessons from Sindh. The FBR’s annual tax directory of 2018 showed that Sindh contributed 45 percent to the total revenue collection. It is important to point out that tax collection is the principle way of resource mobilisation for sovereign countries.”

Senator Sherry Rehman said the federal government must come up with a tangible short- to long-term economic-sector reform programme to fix matters instead of constantly looking back.

“The parliament must also be kept in confidence. We have every right to question the federal government’s negligence and continuous mismanagement in the economic sector,” she added.