KARACHI – The Pakistan Economy Watch (PEW) on Friday said achieving economic stability amid increasing poverty in the country is a delusion of policymakers.
Reduced buying power of the masses due to increasing poverty is resulting in economic problems which are against the interests of the country and people, it said.Â
Tax measures and increased cost of energy has swept the buying power of masses, therefore, the majority has stopped buying anything except necessities which has clipped demand, said Dr. Murtaza Mughal, President PEW.
He said that reduced demand has brought down the production of factories resulting in layoffs that have thrown millions in unemployment.Â
Dr. Murtaza Mughal said that Pakistani industry relies on the local market is exports of 300 billion dollar economy is just 19 billion dollars.Â
The agriculture, industry, and the services sector depends on the local market which is in bad shape due to policies of IMF which will push the country to seek another package sooner than expected.
He noted that current interest rates are higher enough to crowd out the private sector as it is only benefitting the commercial banks and the government which it has broken the back of other sectors.
The higher cost of credit can have a detrimental impact on private investment and lower rates boost it, he added.
Current interest rates and set of policies are enough to shatter economic beyond repair, therefore, it should be revisited immediately, he demanded.Â
