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External Debt Will Rise To $120 Billion In Next Two Years: Hafeez Pasha

Pakistan’s external debt would increase to $120 billion in the next two years, economist and former finance minister Dr Hafeez A Pasha said writes in his book.

The reason for the increase is Pakistan Tehreek-e-Insaf (PTI)’s continuous borrowing of money from the International Monetary Fund (IMF) and friendly nations e.g. China, Saudi Arabia and the United Arab Emirates (UAE).

In his book titled ‘Growth and Equality – Agenda For Reforms’, Pasha projects that external financing requirement over the three year period would add up to $66 billion. The ex-FM also predicts that poverty and unemployment would increase in the coming years.

The unemployment rate might jump from 6.3 percent in 2017-18 to 7.2 percent in 2018-19 and to 8.3 percent by 2020-21, writes Pasha. Also, the number of people living below the poverty line would also increase to 6 million by 2012, which is a 6 percent increase.

Pasha wrote that Pakistan’s GDP growth is expected to fall sharply from 5.8 percent in 2017-18 to 3.8 percent in ongoing fiscal year 2018-19 due to large devaluation. Inflation would come down to 6.3 percent by 2019-20 and fiscal deficit would continue to decline at a modest rate to 5 percent of the GDP by 2020-21.

He opined that for Pakistan to come out of the country’s economic woes, it has to revive its agriculture sector. He said by increasing credit availability to the agriculture sector, especially small farmers and keeping a check on prices of the fertilizers, Pakistan can achieve agricultural goals.

Pasha recommended that the PTI government must focus on manufacturing sector, enhancing private investment, public development spending, privatization programme and employment generation strategy in next few years.

Inflation hit 9.41 percent on Monday, a five-year high. Last week on Friday, petrol prices were increased by Rs6 per litre amid severe backlash for the ruling PTI. The prices of light diesel and kerosene oil increased by Rs3 per litre each, while high-speed diesel soared to Rs117.43.

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