KARACHI – The Pakistan Economy Watch (PEW) on Wednesday said despite claims to reduce circular debt to zero by December 2020, it has reached to the mark of two trillion rupees becoming a grave threat to the struggling economy.
The infamous debt stood at Rs1.1 trillion when the government took charge while power tariff was increased repeatedly to tackle the debt but to no avail, it said.
Despite an improvement in the law and order situation in troubled areas, recovery of electricity bills was not ensured in the areas where the government now enjoys writ and the burden is being transferred on those who pay their bills regularly, said Dr. Murtaza Mughal, President PEW.
No serious efforts were initiated to reduce theft, improve recovery or introduce reforms in the bleeding power sector and now the export sector has been targeted to improve the income of power companies, he added.
Dr. Murtaza Mughal said that efforts to extract additional billions out of export sector may leave it bankrupt resulting in in closure of hundreds of textile units and unemployment of a million people.
He said that textile sector is already facing challenges due to coronavirus as the import of raw material from China has been blocked, local suppliers have increased the prices while other countries have also augmented the prices of raw material making business difficult for the local industry.
The export sector should be spared, their refunds of Rs250 billion should be paid and failed state-run corporations should be sold without delay while the elite enjoying undue tax exemptions should be taxed to raised trillions in revenue.
He noted that the useless process of accountability and misdirected austerity has blocked local and foreign investment, reduced GDP by over 50 percent as compared to recent past, left hundreds of thousands jobless and triggered inflation bleeding masses white.
Dr. Mughal said that unnecessary secrecy on CPEC is a big hurdle in private attracting investment in this project and that the problem should be tackled otherwise foreign loans would surpass 138 billion dollars by 2024 creating a crisis as payments of debt and liabilities has already exceeded the government’s net revenue receipts.
