KARACHI: The state cannot extract resources out of the empty pockets of the poor. The only solution to avert the economic meltdown and revive the economy is to reduce non-development expenditures, including non-combat defense expenditure by 20 per cent, and ban all non-essential consumer imports.

These points were raised by seasoned economist Dr Kaiser Bengali at a presser held at the PMA House on Thursday.

The event titled ‘Averting Economic Collapse’ was organised by the Concerned Citizens Alliance.

Speaking about how families are coping with unprecedented price hike and inflation in the country these days, Dr Bengali said state’s bankruptcy had led to the bankruptcy of the middle class and poor families, who were now without money even to buy food.

Kaiser Bengali advises govt to reduce non-development expenditures for economic revival

“Families already below the poverty line are surviving on a meal of two rotis and a cup of tea that costs Rs100 per meal per person,” he said.

Explaining the reasons behind the current poor economic conditions, he said Pakistan’s economic/infrastructure base had been eroded by over 40 years of consistently reduced public investment, and the country had been taking loans to repay past loans and to maintain foreign exchange reserves for many years.

“Agriculture and industry both have declined. We are now importing basic food items and cotton for the textile industry while the economy does not have the capacity to generate more revenues or to raise exports in the short run.”

Dr Bengali urged the government to restructure the economy for the benefit of the people. “The government expenditures of Rs200 for every Rs100 of revenue is unsustainable. Imports of $220 for every $100 of exports are unsustainable. Both have driven the economy onto a debt-ventilator.”

He recommended that the government shift long distance goods transportation from road to rail, prioritise power generation based on local fuels and ban all non-essential consumer imports.

“Adopt a mix of import substitution and export promotion. Aim at self-sufficiency in basic foods. Provide flour, pulses, and cooking oil at 50pc cost to 25pc of population.”

In his remarks, Edhi Foundation chairman Faisal Edhi called for urgent relief measures, highlighting that the number of poor patients seeking welfare assistance had risen dramatically in recent months. “It’s only the poor, the people with limited resources facing the brunt of economic meltdown. There is a need to hold the elite accountable for their corrupt practices,” he said.

Published in Dawn,June 10th, 2022