Former president of the Islamabad Chamber of Commerce and Industry (ICCI) Dr. Shahid Rasheed Butt has said that the IMP despite its strict attitude has not been able to force Pakistan to follow fiscal discipline. In a statement issued here on Tuesday, he said that the country was barely avoiding bankruptcy while the inflation was uncontrollable, yet the spending spree continues. Shahid Rasheed Butt said that the displeasure of the IMF was increasing due to continued violations of basic economic principles, open violations of agreements with the lender, and irresponsible fiscal actions.

The current budget was not in accordance with the country's economic conditions and ground realities, and it can be kept alive only with the help of loans worth billions of dollars, he added. The business leader said that one or more mini-budgets will have to be introduced in the current year to control rapid economic decline, adding that in the current situation, quick restoration of the IMF programme is difficult, without which new loans and rescheduling of old loans will be very difficult.

In the present scenario, the government will have to rely on local banks for disbursements, which is an expensive option that will lead to reduced productivity, increased inflation, and mistrust of the business community, he added. "The IMF has serious reservations about fiscal irresponsibility and mismanagement, which will contribute to increasing deficits and inflation," he warned. The IMF was also uneasy over the lack of interest by the authorities in getting the country out of the current mess, he said.

The GDP growth rate has decreased to only 0.29 percent from last year's 6.1 percent. The performance of all three sectors of the economyóagriculture, industry, and the service sector was disappointing compared to the previous year, and none of the sectors could achieve their targets. He said the per capita income has also decreased by eleven percent, and people have been waiting for some good news since last year. Many experts believe that the signs of a default have appeared, barring an official announcement, he added.

Credit: Independent News Pakistan-INP