Whopping Rs30,000-trillion debt cause of all crises: Hafeez Shaikh

A day after Opposition leaders in the National Assembly flayed the government over the economic situation in the country, Special Adviser to the Prime Minister on Finance Dr Abdul Hafeez Shaikh on Wednesday put up a stout defence of the PTI-led government’s policies, saying all crises will be over soon.

Taking the floor in the lower house of Parliament, Shaikh said the country’s mighty Rs30,000 trillion debt was at the root of all the crises. “Our biggest challenge is that we don’t have any dollars,” he added.

He said the previous PML-N government burnt dollars to keep the rupee stable. “Keeping the value of dollar under control artificially had impacted our exporters, which ultimately led to drop in exports.”

“You can print rupees but can’t print dollars. The only way to earn dollars is exports,” Shaikh said.

Shaikh said the PML-N government spent Rs2,300 billion more than its income. “When the PTI government took over the country was on the verge of default due to the current account deficit. Foreign exchange reserves declined sharply.”

The government, he said, was working to reform the tax collection system as the country was never successful in achieving revenue collection targets, the advisor on finance admitted.

Responding to the ‘unnecessary’ criticism from the leaders of the Opposition parties, Hafeez Shaikh said those who rushed to get IMF loans were now criticising the government. “It had become unavoidable for us to approach the IMF for a loan package aimed at to save the country from default. It’s our national duty,” he maintained.

“Look what this package brought to Pakistan. It restored other institutions like World Bank and Asian Development Bank’s trust in our country.”

He regretted that State Bank Governor Reza Baqir was being targeted for being an IMF representative. “He sacrificed his job for the country. I am proud of him, we should all be proud of him.”

The adviser cautioned that the consequences would be devastating if the government failed to deal with challenges in the energy sector. “There was no mentionable improvement in the agriculture sector too,” he added.

“Paying attention to the public’s problems specially the education is the key to see progress in the country,” he opined, adding Pakistani companies’ value has gone up 50 percent after economic stability.

Shaikh said country’s economy had turned around and started to show positive signs which was also acknowledged by the world financial institutions including the IMF. Institutions like Moody’s and  Bloomberg were appreciating government’s efforts for economy’s revival, he added.

Speaking about government’s austerity drive, the adviser said the government had introduced a tough budget to control the expenditure by Rs40 billion. “We cut salaries of the Cabinet members and lowered budgets of Aiwan-i-Sadr and PM House,” he said and added “We did not borrow a single penny from the State Bank because it adds to inflation.”

Shaikh said "These are big decisions. I have been a part of various governments, no one used to take such decisions."

He said the military leadership also assisted the government by freezing its budget.

Hafeez Shaikh said “The political situation of the country is such that no prime minister has ever completed his or her tenure. The Opposition should wait for the 2023 elections.”

Khaqan fires back

In his response, PML-N senior leader and former prime minister Shahid Khaqan Abbasi wasted no time in pointing out what Hafeez Shaikh missed in his long speech on the floor of the house. “The adviser forgot to mention the flour and sugar crises. Nobody is telling us who are the culprits for these crises. The adviser on finance also did not utter a word about it.”

“The things will not work by just praising the IMF. Look at the flour prices which was Rs40 per kg in 2018 and now it is being sold for Rs70 per kg,” he said and added “Every minister is expert in interfering in others’ work except of his own ministry’s.”

“You are a patriot. Every member of this house is a patriot but who will deliver,” Khaqan said and added “The government has done one good thing by banning shopping bags in the federal capital.”

In his speech, Abbasi said that the rulers should see the facts if they have to run the government. “We do not doubt your patriotism; but for God’s sake, don’t doubt the patriotism of 342 people sitting here (he was alluding to the total number of the National Assembly members).”

“You are challenging the status quo of this country,” he said and added  “See the speeches the ministers delivered yesterday. Will they run the country like this?”

He said the government has fewer economic experts, asking who is responsible for the wheat and sugar crises in the country, adding that 60 billion rupees have been looted on the pretext of these crises.

The government should tell the people who is going to invest in Pakistan? Abbasi also took a jab at the Federal Minister for Science and Technology saying “I’m waiting for the time when Fawad Ch will take us to Moon.”