IMF-led policies leading Pakistan to economic disaster: LCCI

LAHORE: The country’s economy is not moving in right direction and needs to be corrected immediately otherwise it can cause great harm in the near future, a business leader said on Sunday.

“A 17 per cent increase in revenue and enhanced forex reserves amid economic slowdown are surprising and indicate that country is not heading in the right direction,” said Lahore Chamber of Commerce and Industry (LCCI) Shahid Rasheed Butt in a statement.

He said revenue was increasing despite sluggish growth as unhappy masses and the dejected business community had been targeted by the revenue department officials while little had been done to tax the influential untaxed.

Butt said an ambitious revenue target set by the International Monetary Fund (IMF) couldn’t be met by the Federal Board of Revenue (FBR).

He said that exports in January recorded a fall of 3.4pc to $1.96 billion due to economic situation, blocked refunds, political and economic instability, energy prices and other issues.

“On the one hand, we see exports falling while on the other forex reserves are gaining strength because of flawed policies. The method adopted to attract hot money by offering high interest is not sustainable and very risky for the economy,” he observed.

The LCCI president was of the view that the present risky policy of attracting hot money would boost forex reserves to $20 billion while foreign investment in T-bills would jump to $5 billion during the current year but at the cost of national kitty.

“Attracting foreign funds with high interest rates can be repatriated any time that will unleash another crisis in Pakistan, therefore many economic exports are warning against this policy,” he warned.