Totally agree with your post and your sentiments. The ground realities are very different in Pakistan where people are getting hammered due to this idiot and his government. By the way, this douche IK is no different to the other douche bags such as fat aloo Nawazo and the other douche Zardari and his bisexual son.
All these people are corrupt and they are screwing the common man. But I blame all of this ON THE ESTABLISHMENT AND ITS MILITARY who are the real puppet masters and corrupt to core. The 1% rich are getting filthy rich whereas 70% are falling below poverty line. There is NO EMPLOYMENT for the Youth. The unemployment rate in Pakistan is actually 70% among the youth who are forced to go overseas or set up a small food stall to earn money. All in all, IK is a liar and so were all the others before him.
Sweeping statements my friend. I agree on most things you said, but you definitely are wrong on IK and his intentions.
Why the push is on collection of taxes and inflation, which is one of the thing everyone says is fault of IK and PTI, I will give my point of view with valid reasons and why I think it is not IK's fault and why I think Pakistanis should be thankful that IK came in to power, otherwise they would have been facing a terrible terrible situation, far worse than now, I am convinced on it. And here is why.
1- The imports were allowed to go to $60 billions and as a result the Trade Deficit grown to $38 billion.
2- With remittances of around $18 to $ 20 billion, there was still a black hole of roughly $18 to $20 billion. Who in their right mind runs a country like that!!! That was Genius Ishaq Dar and nincompoop Nawaz Sharif. That's why I say Dar should be hanged publicly, end of.
3- Pakistani media is a disaster for Pakistani nation, they never ask Ishaq Dar how the growth of 5%+ achieved in their last year!! It could have come from only two means, partly from imports lead growth and mostly from fudging the figures. Why nobody ask the question from the PMLN, what progress Pakistan had in their government, with facts and figures!!
4- To finance the deficit Dar borrowed heavily. But he didn't borrow in straight manner. He established 25 Limited companies, and borrowed through these companies by giving Sovereign guarantees. Meaning even though the borrowers were the limited companies, Pakistani state was still responsible for the debts.
5- Dr Ishtiaq mentioned that in one of his interview, that PMLN left hidden mines for PTI. PTI initially and until now struggling with those repayments, which became due after 5 years or more. But the interests were payable for those hidden debts every year. For this reason IK has to run to Saudi Arabia and China and borrowed the money, both to keep Rupees stable and also for Pakistan not to go bankrupt and default on its debts obligations.
6- PTI government had to go to IMF for help too. You can argue about it if it is wrong or right decision, but remember this much, the debts were numerous and interest and repayments were not just one off thing. What choices PTI had!! to run to Saudis or ask China's help every time they have difficulties and facing default!! You can dis IMF as much as you like, but they deal with every countries issues with the same yardstick. You cannot spent what you don't have. I hope you and everyone understand this yardstick. So they ask every government who comes for help to do two thing, raise their income to meet their expenses and also cut the expenses by cutting subsidiaries etc. This is a common financial adviser's role, played out in the world. Government can raise income by only one way, by introducing new taxes, increasing taxes, or increasing their tax base. PTI is trying to do that. For that they have to bring those corrupt thugs who had been making millions but paying no taxes. In the process they are making lots of people and industries cartels their enemies.
7- Last bit, the price inflation, which I understand hit the poor most and bring more people under the poverty line. The rich can afford expensive things while poor cannot. There are many reasons for the inflation in Pakistan.
i- International price increases, inflation is a problem in every country at the moment, including USA, UK and Europe. Ask anyone living in these areas, how expensive everything has become in last 2 years. The freight and Insurance charges are high after covid-19 which has increased the prices of almost every item in the world.
ii- PTI had to increase or collect more indirect taxes and levies on the goods, making them more expensive, and hitting the poor folks hard. This goes back to the point I made earlier, you cannot spend what you don't earn. The expenditure needed to pay for the wages, defence, and most importantly the debt and circular debt. No escaping it. You give me some valid examples how Pakistan could have avoided it!!
iii- Only few ways to escape it, and all of them are long run fixes, which IK or PTI couldn't do over night or in couple of years. They are as follows:
A= Increase productivity and Industrialisation in the country. That needs expertise, investment, policies and time to implement and bear fruits.
B- Through those increased productivity and industrialisation more local produces , would result in improvement in direct tax collection, taking the burden of the indirect taxes which is a quick short time fix.
C- More industrialisation and production means less reliance on import, which in turns would benefit by better balance of payment situation for the country, decreasing the pressures further.
D- If you produce more, you would export more, once again it would result in better balance of payment situation, releases the pressure on the Rupee and it would become stable and improve its rate of conversion.
For above reasons, I may be disappointed on few policies and implementation by IK And PTI, but I do not blame them at all. They are and were naive , but their intentions are good. There is no better example of naivety than Asad Umer, who used to mouth off before election like he is a economic wizard but in my very consider opinion, at worst he is naive and inept.
