Rescued from the cliff (Comment )

PM Shehbaz Sharif has dodged the bullet. The prime minister’s three telephone calls plus three meetings saved us from falling off the cliff. The Ministry of Finance was bent upon plunging into the abyss. Regrettably, we hastily accused the IMF of engaging in geopolitical schemes and even plotting to make another Sri Lanka out of us. The one conclusion derived from all of this is that our financial planners possess nothing but their political agendas; they have no economic plan for the 260 million people they govern. It is the IMF that ultimately rescued us from an imminent and disastrous default, as we had failed to devise a viable strategy of our own. Not to forget that the po-litical delays in reaching an agreement with the IMF since November have incurred an economic cost of around $10 billion. Remember, the Stand-by Agreement is for $3 billion while our debt payment over the following 12 months is $23 billion.

The IMF has saved us from an outright default but the situation for the 260 million remains dire. The specter of food inflation looms ominously, surging at an alarming rate of 52 percent—an unprecedented level not witnessed in the past seven and a half decades. The gravity of the predicament is compounded by a staggering actual budget deficit of Rs10,000 billion, painting a bleak fiscal landscape. Desperately attempting to bridge this perilous gap, the government clings to an ambitious yet uncertain vision, seeking to extract a lifeline of $4.5 billion from commercial banks, $2.7 billion from multilateral institutions, $2.6 billion from the IMF, and $1.5 billion from a precarious Euro-bond issuance. These unsettling measures serve as a distressing reminder of our self inflicted economic fragility.

Consider this: Pakistan is set to celebrate its centenary in 2047, which is just 25 years away. A comprehensive World Bank report titled ‘Pakistan@100: Shaping the Future’ envisions a remarkable milestone for the nation, stat-ing that Pakistan has the potential to evolve into a $2 trillion economy by the time it reaches 100 years positioning Pakistan as an upper middle-income country, with a projected per capita income of $5,702.

Pakistan’s exports, currently valued at approximately $30 billion per year, have the potential to reach $88.1 billion annually according to the World Bank’s ‘Pakistan Development Update’.

Pakistan has significant oil and gas potential, with over 9 billion barrels of petroleum oil estimated to last for 45 years, and sizable shale gas reserves of 105 trillion cubic feet (Tcf) expected to last for 58 years. In terms of solar energy, Pakistan has a massive potential of 2.9 million MW. Utilizing a small fraction of the country’s area for solar PV could meet the current electricity demand. Currently, Pakistan has tapped into 530 MW of solar power. Addi-tionally, Pakistan’s wind power potential is estimated at 346,000 MW, with 1,248 MW currently installed.

It is evident that we have been trapped in a trap of our own making. The root cause lies in our tendency to prioritize political agendas over sound economic decisions. Our ‘political model’ is without ‘national interest’. We need ‘poli-tics of national interest’. It is not a complex conundrum; rather, it is a glaring issue that requires our attention. We possess the necessary resources and abundant talent to thrive. However, what eludes us are two crucial elements: political stability and policy continuity. Addressing these missing pieces will pave the way for a prosperous future and steer us away from the perils of our own creation.