THIS is apropos of the news report ‘Pak team returning without money’ (April 19). Economic managers, as well as political leaders, should revisit the plan to go to the IMF and should try to look inwardly.Given the situation in Pakistan, some of these measures are counterproductive. Moreover, international financial institutions such as the IMF and the World Bank always interfere in internal affairs of Pakistan in reshaping the latter’s political and economic policies.

Time is ripe to understand the complex net of IFIs and consider some options to get rid of their policies if we want to see Pakistan developed. An across-the-board consensus on economic reforms is important.

Pakistan collects only Rs1,600bn from taxes, while the tax to GDP ratio is slightly less than 10 per cent as compared to India’s 15 per cent. Only 1.7 million out of 180 million people are paying taxes.

We need to increase the tax base by including agriculture and the real estate sector into it. The government has identified 750,000 people who are affording luxuries but are not giving taxes. These people should be taxed at any cost.

To be able to do so, we need to have a broad-based political consensus on the issue. The economy is on a critical juncture and politics is an unaffordable luxury at the moment.

Statistics show that tax collection is only Rs1.6tr while the expenditure for running the federal government is Rs400 million along with Rs400 million subsidy for loss-making state-owned enterprises (SOE). Here we need to better manage our finances.

Government expenditure can easily be curtailed by 25 per cent, according to many experts. If a private air or transport business can earn profits, why not government-owned organisations. It needs political will, leadership, vision and capableprofessionals. There is no other way to tackle the issue of loss making SOEs; either make them profitable or let them be privatised if you cannot manage them properly.

Political stability is imperative for economic prosperity. Persistent economic policies, security of investments, corruption-free environment and a better law and order situation are some of the basic needs which a businessman wants. The government needs to improve each of the aforementioned areas to gain confidence of the investor.

It is time the agriculture policy was reconsidered. The policy envisages increased production of crops through enhanced support price which is counterproductive. It is because the common people find it difficult to earn their living in a situation where commodities are more expensive than the probability of getting job or daily wages.

If support price mechanism is changed with subsidising pesticides, seeds and fertilisers along with provision of expert opinion through efficient service of the agriculture department, the productivity can be enhanced.

This way we would be able to increase production, and ultimately the exports. This will decrease the amount spent on foods and would increase socio-economic development. This initiative would indirectly make the economy stable andself-sufficient.

The policies of IFIs are counterproductive for economic growth, as well as for national security. According to the finance ministry, we need Rs800bn for debt-servicing each year. This means half of our taxes collected go to debt repayment. If this situation of getting more and more loans continues, I fear the day when all our taxes would not be enough for debt repayment.

The economy of the country is on the brink of collapse. It is the political leadership which has to take difficult decisions in this situation. But to do so, political will, leadership vision and character are of utmost importance.

SHAKEEL BABARIslamabad