Economic emergency

SOUTH ASIA POLITICS A Financial Crisis Similar to how "Nero" famously played the flute while Rome burned, Pakistan's Finance Minister Ishaq Dar has made it a point to constantly repeat his mantra of "sub achha" (all is well) as the country's economic outlook continues to deteriorate.

Dar defied warnings that Pakistan would default on its obligations to repay its foreign debt in the near future with his most recent assessment of the economy moving in the "right direction." Although the finance minister recently returned to Pakistan as a result of the most recent reconciliation between the PML-N, the ruling party, and the power behind the throne, serious long-term observers of the economy continue to view him with contempt.

Currently, Pakistan's economy is in a crisis mode while it waits for long-overdue emergency measures to take effect and prevent the country from falling over the edge. The finance minister has been quick to label his critics as nothing more than prophets of doom who are determined to overburden an issue that is far too manageable. However, this is absolutely not the case.

Dar's perspective on the world continues to be centered on the promise of continued financial inflows to keep Pakistan's liquid foreign reserves from boiling over into a full-blown crisis for the time being.

However, the ongoing fluctuations in the rupee-dollar exchange rate, such as against the US dollar, are enough to keep many policymakers awake at night. For the time being, Dar's promise to oversee the Rupee's significant gain of up to 10% or more has only been the subject of jokes. In contrast, projections for the future only take into account the rupee's decline over time.

In the meantime, a variety of stakeholders, including high-level policymakers and common consumers, continue to be plagued by other obstacles, most notably unchecked inflation. And Pakistan's ability to recover from the effects of flash floods, which cost the country a lot of money last year, is still uncertain.

At the same time, some of the most perplexing questions regarding Pakistan's economy's long-term prospects remain as perplexing as ever. Not only have previous regimes, including the current one, failed to modernize the country's tax collection sector. As a result, the public sector's spending has not been severely reduced, resulting in a dangerously widening budget deficit.

In addition, rather than generating additional revenue from exports, Pakistan's economy has become increasingly dependent on imports over time. The outcome has prompted rehashed equilibrium of installments emergencies in Pakistan's set of experiences, with practically no arrangement in sight aside from Islamabad to globally aimlessly get.

Pakistan, on the other hand, needs to cut its losses quickly by implementing radical and unprecedented reforms that it has never seen before.

Pakistan cannot afford to continue subsidizing its large public sector as it has in the past. Long-term customers have coined the phrase "perhaps it'll arrive" to describe businesses like PIA, which have developed such a bad reputation for deteriorating service quality in multiple areas. Without timely reforms, successive governments have subsidized the state-owned airline and increased their national debt stock year after year.

In the absence of corrective measures, the fundamental issue associated with such mounting losses has grown over time. Other organizations, such as the Water And Power Development Authority (Wapda), which is owned by the state, have suffered such substantial losses over the course of time that they pose an unprecedented threat to Pakistan's very existence. Pakistan's ever-increasing circular debt, primarily fueled by unpaid energy sector losses, must either be resolved or it will eventually wipe out the country's remaining financial viability.

On the other hand, an urgent shift in priorities must drive a new approach to managing Pakistan's economy. All of the country's resources must be put to use as the country struggles to stay solvent. In order to safeguard the national interest, successive Pakistani rulers have created holy cows and protected them from sacrifice for decades. Today, however, there is only one national interest: to protect Pakistan's economy in the event that it defaults on foreign payments.

In the future, Pakistan's urgent need to be saved calls for radical new reforms that have never been attempted before. The problem of patronage when using public sector resources must be resolved immediately, and every option must be considered in order to raise funds and advance Pakistan's national interests.

A single question must become increasingly pressing as Pakistan faces the daunting task of rescuing itself from a forthcoming disaster: Can Pakistan be saved by Dar's or others' interests, who have overseen the country's squandered economic interests in the first place? D HEGEMONIC INDIAN DESIGNS