September 10, 2023
Economy Pakistan

Pakistan’s Economic Dependence and Challenges

Pakistan's Economic Dependence and Challenges

In a recent media interview, former Pakistan Finance Minister Miftah Ismail spoke about the current economic crisis in Pakistan. He blamed his successor, current Finance Minister Ishaq Dar, for taking an anti-International Monetary Fund (IMF) approach that has contributed to the country’s economic problems.

Ismail also criticized the current governance model, saying that if countries like Bangladesh and India have surpassed Pakistan, there are serious deficiencies in its governance. He stated that despite trying various forms of government (democracy, parliamentary democracy, dictatorship), the country continues to be ruled by a small elite, which is one of the main reasons for its numerous challenges.

There has been growing criticism of Pakistan’s foreign policy and its excessive economic dependence on other countries. Analysts have questioned the terms and conditions of the China Pakistan Economic Corridor (CPEC) project and the lack of transparency. The current economic crisis in Pakistan has sparked opinions about the negative impact of domestic policies, the country’s dependence on external aid from the US, Gulf Countries, and China, and the unequal impact of the IMF rescue program on different sections of the population.

Maleeha Lodhi, a former Pakistani diplomat and prominent writer, argues that the availability of external resources has created a habit of dependence on outside help and urged successive governments to avoid economic reform and mobilize adequate revenue. Touqir Hussain highlights how Pakistan’s dependency on China could harm the bilateral relationship and foment anti-Americanism. S Akbar Zaidi points out how the IMF program will have an unequal impact and benefit the elite in the long run.

Shahzad Chaudhry, a strategic commentator, suggests that Pakistan should rethink its approach towards India and focus on geo-economics. Pakistan PM Shehbaz Sharif also stated that Pakistan cannot afford another war with India and expressed willingness to resume talks with India, though the Pakistan PMO later said talks would only resume if India reversed its decision to revoke Article 370 in Jammu and Kashmir.

In conclusion, Pakistan needs to overcome its excessive dependence on external countries to put its economy back on track. The country should also strengthen economic ties with its South Asian neighbors. This will require innovative thinking by Pakistani leaders.

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