Why is there still a question mark on this government's performance?

Byline: Fazeel Asif

Prior to General Elections 2018, the then federal and provincial governments were busy painting the good picture. In pursuit of portraying the much touted 'stabilized economy' through doctored image of fiscal policies in the center and so-called delivery mode in Punjab, former rulers have been hiding all the dirt under the carpet. The glitz and glamour of the ostentatious projects adversely affected the national kitty. So much so that the financial and development cycle was about to collapse, and system was at the brink of bankruptcy.

This bankruptcy did not mean financial meltdown alone but it meant, no funds for availability of medicines at the hospitals, no funds to pay teachers at government schools, no funds to maintain law and order, in a nutshell no funds to operate anything in the country.

Fiscal deficit had soared to 6.6% of the GDP, the current account deficit had peaked at $20billion and 6.1% of the GDP and public debt had increased to approximately PKR 30 trillion. Foreign exchange reserves of the country were depleting at an accelerated rate, the value of the foreign exchange rate was set artificially, and inflation was starting to affect the lives of millions of Pakistanis. At the same, structural weaknesses in the economy remained unaddressed: a chronically weak tax administration, a difficult business environment, inefficient and loss-making state-owned enterprises (SOEs) and a large informal economy. During this toughest period of the history, PTI formed government in 2018. The ongoing crisis did not let these difficult circumstances deter the government and PTI immediately started taking measures to stabilize these macroeconomic imbalances, including but not limited to IMF and seeking collaborations with brother countries.

The difficult steps taken by the government in the previous year and agreement with the IMF have started to bear fruits: After failing to show a current account surplus for the past four years, Pakistan, in October 2019, posted a $99 million current account surplus.

The current account deficit in the balance of payments reached a peak of almost $20 billion in 2017-18. It underwent a downward trend and reached to $13.6 billion in 2018-19. The current account fell further by 74% in Jul-Nov 19 and is expected to remain at $6-8 billion. FDI increased 78% in the first five months of current fiscal year and the economy is expected to grow by 3.5% in the next year. Exports which had posted...