FRIA calls upon government to announce clear, robust economic strategies

The Ferozepur Road Industrial Association (FRIA) has called upon the government to announce clear and robust economic strategies, as the country has been stuck in a low economic growth situation, where the double-digit policy rate for the last few years has diminished capacity to increase domestic production, and exports, negatively impacting domestic resource mobilization.

FRIA senior vice chairman Shahbaz Aslam said that the government will have its work sharply cut out as far as the economic challenges are concerned. This came at the back of a fast-unfolding climate change crisis that pushed millions into poverty with little fiscal capacity of the government to provide anywhere near close to what was needed in stimulus spending. Then there is acute debt distress, and seriously high inflation at the back of global aggregate supply shock, and accentuated by a world of rising conflicts, mainly in Ukraine, and the Middle East.

FRIA senior vice chairman Shahbaz Aslam emphasized that such transparency from the government is crucial, as the country has had trouble raising enough money to cover its expenses. He said that the domestic investment at the moment is alarmingly low which has sent a negative signal to the potential foreign investors and now is the time that the federal government should give some patient hearing to the private sector calling. He said if the government was seriously desirous of having economic turnaround in the coming years it would have to do two things that are: an immediate freeze on domestic and foreign borrowing and secondly put in place a well-tailored strategy to showcase Pakistan’s potentials to the outer world.

The FRIA SVC said that even though Pakistan’s economic crisis is a recurring factor in the country’s political unrest, it has a history of ignoring the nation’s true issues, which include poor governance, a broken judicial system, outdated laws, complicated tax system, lack of transparency, duplication in the government system, ineffective bureaucracy, improper use of our human, natural and water resources, lack of efficient local government, inadequate data for country’s planning, and the consistent flaws in policies in execution by the government departments.

Shahbaz Aslam said that Pakistan’s GDP growth rate has always remained below its potential despite efforts to boost economic growth. He said that the development of important sectors and investment prospects was hampered by inadequate revenue collection, structural problems, and governance issues.

He said that due to the low tax-to-GDP ratio, borrowing and outside help are heavily relied upon to close the fiscal imbalance. There is a recurring budget deficit because the government spends more than it takes in. The national debt burden has risen, as a result, needing substantial financial resources for debt repayment. Both internal and external debt in Pakistan has been constantly rising.