Promising long-term reforms, Dar reassures nation Pakistan will not default

Published June 3, 2023
Finance Minister Ishaq Dar speaking to a delegation of the Karachi Chamber of Commerce and Industry in Islamabad on Saturday. — DawnNewsTV
Finance Minister Ishaq Dar speaking to a delegation of the Karachi Chamber of Commerce and Industry in Islamabad on Saturday. — DawnNewsTV

Finance Minister Ishaq Dar on Saturday “reassured” the nation that Pakistan will not default and promised that the government had planned reforms for the country’s “long-term betterment”.

Speaking to a delegation of the Karachi Chamber of Commerce and Industry in Islamabad, Dar said: “Our main objective today is just to assure you that as your economic team, we are putting in all the efforts to get out of this [crisis].”

“God-willing, we will be coming up with new ideas in the weeks to come. There will be the budget and some work after that as well for Pakistan’s long-term betterment. We will bring an agricultural revolution in Pakistan, [and] a sovereign wealth fund will be created,” he said.

The minister’s assurances come as the country still awaits the much-delayed signing of an International Monetary Fund (IMF) staff-level agreement, which would unlock $1.1 billion in financing for the cash-strapped nation as part of its $7bn package.

Pakistan on Thursday recorded its highest-ever annual inflation of 37.97 year-on-year with the finance ministry terming flood damages, disruptions in supply chains, devaluation brought by the macroeconomic imbalances, and political uncertainty as the potential reasons for the price hike.

In another assault, the Oil & Gas Regulatory Authority (Ogra) last night asked the government to increase gas tariff by 45 per cent to 50pc for all consumer groups across the country to meet revenue requirement of two gas utilities — Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL) — during the fiscal year 2023-24.

At the outset of his address, Dar admitted that the tough economic decisions taken by the government had put an “undoubtedly great burden on the business community and the common man”.

At one point, he stated that the government’s top priority was to ensure that “there is not a single day’s delay in Pakistan’s sovereign commitments”. Dar asserted that there had been no such delay thus far.

“Some people like to give dates that [Pakistan] will default on so and so date — they should be ashamed. They should be well-wishers [of Pakistan] and be loyal to their soil.

“Pakistan is a sovereign country. Pakistan has trillions of dollars of assets. If we have external debts of 100 billion, we also have assets,” he maintained.

Dar claimed that one asset relating to gas infrastructure was equivalent to 50pc of Pakistan’s debt.

Recounting the economic difficulties the country faced in 2014, the minister said that one year was difficult but then “everything was normal once things had settled down”.

The PML-N leader went on to claim that Pakistan had become the “best economy in South Asia” and the policy rate was 6.5pc when the PTI government took over.

According to Dar, there were “only two options” available with the parties currently in power when they took over in 2022 — either to “let the previous government stay [in power] and wait for complete destruction to take place, god forbid or to take a bold decision”.

Admitting that the government knew it would not be easy to deal with the economic crises, the minister said they took the difficult decision of “taking responsibility […] no matter the loss to the political capital”.

He then asserted that the “most difficult reforms have taken place” and expressed hope that there would be no issues in multilateral dealings as well.

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