If you listen to any member of the ruling party they will paint a rosy picture of the country’s economy. The arguments they hold are many for instance they will tell you that the economy is now stable, the security situation that has a direct bearing on the economy is now much improved and the often repeated claim of the fading energy crisis. Another key fact being thrown around is that of the reduced budget deficit and the ever increasing foreign exchange reserves. However what you won’t be told is that the inflated foreign exchange reserves have little practical value as the import bill has risen massively in recent years rendering the increase foreign exchange reserves useless. A related serious issue is that of the import bill that seems to be increasing rapidly and makes an even worst scenario when you look at our export performance. Exports are on a continuous downward slide and remittances have started to slow down with foreign direct investments down 53 per cent in the two-month period of July and August over the previous year. External trade figures are depressing, and it’s the global decrease in oil prices that have managed to keep the trade deficit in check. If it wasn’t for the global decrease in oil crisis we would have been in a major financial crisis. The massive loans that we have taken wouldn’t have sufficed. When it comes to foreign direct investment (FDI) China continues to be a major contributor of Pakistan’s FDI with other countries slowly, but gradually, pulling out their investments. The tensions with India will further affect foreign investment. The government seems to have put all eggs in one basket; the CPEC. This does not look to be a wise strategy.
The artificial economic stability could soon collapse with devastating impact.