In the three years of PTI’s regime, the government has added almost Rs.15 trillion to the public debt account, which is 140% of the entire debt that Pakistan Muslim League – Nawaz (PMLN) had accumulated over their five years in power. This is a big failure on the part of Imran Khan as his claims of lessening the nation’s debt have taken on an opposite path.
As per the yearly debt announcement released by the State Bank of Pakistan (SBP), Pakistan has acquired a 60 percent increase in the debt from July 2018 to June 2021, which gives us an unfeasible average rise of 20 percent per year.
According to the SBP bulletin, with the addition of 14.9 trillion, the public debt has risen to Rs 39.9 trillion in June this year, which is about 83.5% of Pakistan’s gross domestic product (GDP).
Although, this year’s debt expansion has been 4.1% less than the previous fiscal year of 2019-2020. It still remains 11% higher than the GDP, which is a level higher than on which PMLN left the government and also infringes the Fiscal Responsibility and Debt Limitation Act of 2005.
Reasons for the spreading liabilities include many such as the difference in the accumulation of revenues and the estimated expenditures, inelasticity of debt servicing, continuing defense needs, depreciating currency exchange, and the inability of the Federal Board of Revenue (FBR) to boost revenues collection to an abounding level.
Particularly, the total domestic debt rose by 60% taking the amount up to Rs 26.2 trillion with the addition of Rs 9.9 trillion in the last three years. The external debt too increased by 60%, through a net increase of Rs 4.6 trillion. The currency has also seen a depreciation of Rs 36 or 29.4% as the value of the dollar spiked from Rs 121.54, in June 2018 to Rs 157.3, in June 2021. Moreover, the International Monetary Fund (IMF) debt which had been $6.1 billion escalated to $7.4 billion after three years, in June this year.
This economic performance has also been critiqued by Senator Sherry Rehman, Pakistan People’s Party (PPP) representative, who stated on Saturday that, “The reality is far different from what the government is telling us. With all the key macroeconomic indicators faring poorly in the face of the three years of PTI governance, it is shocking to see the self-congratulatory media appearances while millions in Pakistan are suffering from poverty, food insecurity, and unemployment. Unfortunately, the future does not look too bright with the unapologetic increase in public debt and current account deficit, Pakistan is going to struggle on the global scale.”
