ISLAMABAD: Senator Sherry Rehman of the Pakistan Peoples Party expressed concern over the state of the economy and regretted that the government had “run Pakistan into a debt trap deeper than it had ever been in before”.

“This must be the only government which is happy about a trade imbalance,” the PPP leader said in a statement while commenting on the Economic Survey released by the government here on Thursday.

The PPP senator said “by putting everything on the China-Pakistan Economic Corridor (CPEC), the government is sitting back and explaining away all its missed targets and growing deficit”.

“Instead of even pretending to balance its budget, this government is going headlong into the next financial year by deepening the huge annual current account deficit,” she said, adding: “This is unprecedented even for this government which has run the treasury on empty.”

Ms Rehman said according to the Annual Plan 2017-18, the budget would be marked with incessant borrowing, more indirect taxes, a surreal deficit and skyrocketing debt.

“It is projected that our current account deficit will reach a staggering $10.4 billion from $7.2bn last year. This is mainly because our trade deficit amounts to almost $26.9bn which was roughly $16.5bn during the PPP’s last year in government. Estimates suggest that this year’s current account deficit rose by 42pc compared to last year. How is this not raising any red flags for the government?” the PPP senator asked.

Ms Rehman noted that the PPP had continuously pointed out the dangerous downward trajectory that the country’s economy was taking. “Since this government came to power, our current account deficit has constantly been increasing. Trade deficit and borrowing have reached a record high, exports are down, remittances are falling and the foreign direct investment is plummeting,” she said.

The PPP senator also criticised the government’s track record and failed campaign promises, saying: “Exports have declined by $3bn, external debt has increased by $6.3bn, domestic debt has increased by 78.5pc, there is a decline of 2.8pc in remittances and circular debt has reached over $4bn in the span of four years.”

“Whatever happened to the big promises the PML-N made during its campaign?” she asked.

Ms Rehman elaborated that the government had once again, for the fourth consecutive time, failed to meet the GDP growth target due to their ruinous economic policies and poor performance. Economic indicators were gloomier this time around, since the government had missed all major economic targets, she said, adding that the fiscal deficit was 4pc over the target and key sectors such as agriculture and services did not show signs of an upturn.

“Indirect taxation is another point of concern. How can a country address its huge social inequalities if it continues to rely on indirect taxes? And a fiscal policy with no plans for raising revenue at home will just end up in more borrowing. In fact, according to reports, Pakistan is already planning to get $8.1bn in new loans. We cannot afford that. As it is, we are already stuck in a merry-go-round of borrowing,” Ms Rehman said.

She alleged that the government did not have a coherent economic framework, nor did it seem to be bothered by this economic freefall. “Everyone, from top economists to the IMF and World Bank pointed out the need for structural reforms and clearer policies. No one in the Ministry of Finance seems to pay heed,” she said.

She said that no country could become truly sovereign if it relied on loans and foreign aid as a matter of policy. “Borrowing in the form of short-term loans has become the finance minister’s de facto policy and as many have warned, this could be catastrophic,” she concluded.

Published in Dawn, May 26th, 2017