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Pakistan’s economic future

Pakistan’s economic future

Taking a resolute approach, Pakistan’s new finance Minister Ishaq Dar has swiftly concluded a desperately needed loan agreement with the IMF to ensure that the country does not default on its external debt payment obligations. Following the settlement of this $5.3 billion bail out package, Pakistan once more remains subject to stringent multilateral conditions, among them the urgent requirement to broaden its tax base. With endemic corruption straining the reform process, expanding the tax base has always remained an elusive goal. In a country where the riches keep going to the summit of society and where inordinate wealth is seen against the background of desperate poverty, a progressive regime in which the richest are taxed higher with proper mechanisms to ensure collection and identify tax evaders must be implemented.

Pakistan’s acute energy crisis is just one of the unprecedented challenges facing the country, gravely threatening its economic future. With continuous power cuts crippling business and industry, people’s frustration over unceasing load shedding during the scorching summer months, the collective anger over power cuts at a time of maddening heat exposes how democracy has yet to improve people’s lives in any meaningful way.

Prime Minister Nawaz Sharif’s visit to China has already resulted in positive outcomes with the conclusion of several memorandums of understanding including the Pakistan-China Economic Corridor accord. However, continued violence makes Pakistan a daunting investment prospect. Terrorism in Pakistan shows no signs of abating with deadly blasts in Lahore, Quetta and Peshawar claiming more lives over the recent weeks. Instability in Pakistan is underscored by a fragile Afghanistan where decades of war have engendered enormous deprivation. As the US drawdown from Afghanistan continues, ensuring a smooth transition process remains critical to Pakistan’s tenuous security situation.

Nowhere is the mutability of political fortunes more sharply illustrated than Pakistan and with a third chance to govern, the new Nawaz Sharif led government must seize on all opportunities to ensure that democracy delivers on its promise of liberation to the people.

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