KARACHI: Pakistan’s economy is facing with a number of problems and uncertainty but the situation is changing, said State Bank of Pakistan (SBP) Governor Reza Baqir on Wednesday while addressing the flag hoisting ceremony held at the State Bank Building to celebrate the country’s 73rd Independence Day.
Baqir admitted that the economy is weak, unemployment is rising and inflation is moving upwards but the country is heading in the right direction.
“I assure you that we are in the right direction and if we continue to move in this direction with commitment, we will surely achieve the prosperity, development and the targets set by the government,” the governor said.
He said the economic team is working on a plan to strengthen the economy. “The plan will help achieve economic development and benefit the low-income and middle-class segments of the population.
SBP governor says key challenges including high unemployment and inflation are being addressed
He emphasised that our biggest challenge is to bring continuity in our policies and if we succeed to bring continuity in policies, I have no doubt that the country’s future is bright.
The government has initiated a reform package but the move has affected general public as they bear the brunt of rising inflation which has already scaled new peaks.
Further, the policy interest rate has climbed to 13.25 per cent affecting various segments in the economy.
On the other hand, incumbent government’s strategies to increase revenue though new measures coupled with unbridled inflation have pushed up interest rates.
Resultantly, the rising rates have created uncertainty. At the same time, the ongoing tussle between the government and trade bodies has further escalated the situation.
The governor realised the situation and expressed hope while assuring the nation that economy will improve. Baqir’s speech was full of hopes and assurances for prosperity and development of the economy.
The above stated narrative of Governor SBP depict grim picture of the state of economy of Pakistan that call for taking measures on emergency basis to improve the situation, which so far, regretfully, little has been done.Bad governance and lack of ease of doing business are the crux of the basic problems.
I think governer-imf Forget that he is not working for imf.he should cover interest of Pakistan rather than imf
The government’s drive to enhance revenue through new budgetary measures may not prove fruitful unless it takes cognizance of FBR’s problems. The FBR’s field offices ,specially on IRS side,ie, RTOs/LTUs are faced with acute shortage of human and physical resources. So, even if the government introduces new avenues of revenue through enactment, in the absence of requisite personnel and logistical support the field formations may not be able to implement them. Resolving this issue becomes even more important when viewed in the context of government’s resolve to broaden the tax net. At present, the already overburdened officials have been given additional charges to carry out this arduous job, and that too without allocating additional resources.
Though the government is heavily reliant on FBR for achieving its budget, but is treating them like adversaries. The PM never misses an opportunity to call them corrupt as if rest of departments were corruption free. There is no denial of corrupt lot in the FBR, but there are many other departments where the level corruption is much higher. A yard stick for this may be taken the number of arrests made by NAB in different departments vis a vis FBR. This attitude on the government ‘s part has a demoralizing effect on FBR employees ,much to the detriment of revenue collection.
Thus, if the government is really serious about increasing tax to GDP ratio, it must resolve the highlighted problems in the first place, and in the second place ,motivate the FBR’s staff instead of criticizing them unduly.
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