Pak teetering on the brink of complete economic breakdown: Finance Minister

[somebozo]

Privatize the Railway and PIA.....

And that will do exactly what??

PIA and Railway alone are not consuming even part of what the corrupt leaders are pocketing. Seriously there is no such magic called privatization to fix all ailments. An efficients management is needed to run a business in most profitable manner wether private or public.

 

[Dark Angel]

Pakistan floods unleash desperate economic crisis



The catastrophic floods spreading across Pakistan have dashed any hopes of an economic recovery in the poverty-stricken country. The estimated death toll is around 1,500, but this number is expected to increase significantly in the coming weeks.

Millions of displaced Pakistanis are threatened with starvation and an epidemic of water-borne diseases. According to the United Nations, there have already been over 120,000 documented cases of dengue and malaria, while hundreds of thousands have been affected by skin infections and diarrhea. The World Health Organization stated that there has been a 30 percent increase in cases of diarrhea around the country since the flooding began.

The Pakistani economy had already been reeling from the global economic crisis and the militancy fueled by Islamabad’s partnership with US imperialism even before the onset of the floods. Over 30 percent of the country’s cultivated farmland is submerged while nearly 20 million Pakistanis, 13 percent of the population, have been displaced by the floods. The Pakistani ruling elite and its allies abroad fear that widespread social unrest could arise out of food shortages and inflation caused by the devastation.


On Monday, Pakistan’s High Commissioner to Britain stated that the total cost of rebuilding Pakistan after the floods could reach $43 billion. The IMF has warned of an economic disaster, and Pakistan’s Finance Ministry has stated that the country would miss this year’s gross domestic product growth target of 4.5 percent. Analysts predict that the damage and cost of recovery could reduce economic growth by more than 2 percentage points. Some are predicting a growth rate of 0 percent.

The Pakistani economy grew by only 4.1 percent last year, well below the rate of growth required to create enough jobs for the increasing numbers of young and working age people. According to Mustafa Pasha, an analyst with BMA Capital Management in Karachi, the deficit may end up being 2 percentage points wider than the official target of 4 percent of GDP. Another analyst stated that the deficit would likely reach 8 percent of GDP.



Cont......

 

[Dark Angel]

“The damage to infrastructure will hurt production at factories, while the flooding has already washed away crops,” said Pasha. “Inflation will accelerate in the coming months. Under these circumstances, it is very difficult to maintain fiscal discipline.”

Apart from destroying and damaging countless homes across the country, the floods have caused considerable damage to roads, bridges, and most troublingly, irrigation and agriculture. The damage to agriculture is of particular concern as it is the backbone of the Pakistani economy. About two-thirds of Pakistanis are employed in agriculture-related work, and over 70 percent of those affected by the floods are dependent on agriculture for their livelihoods, according to the United Nations. Nearly 17 million acres of farmland have been destroyed by the floods. The World Bank estimated crop loss at $1 billion, but stated that the full impact on soil erosion and agriculture won’t be known for another month when the water recedes. Pakistani Foreign Minister Shah Mahmood Qureshi stated that crop losses would amount to “billions of dollars.”

“It seems we’re doomed to walking through a dark tunnel. We’re on an unending path of misery,” Morio Pahore, a farmer from Thul in southern Pakistan, told AFP. “We had goats and buffalo and a wooden hut. We had grain to eat. The river ate everything, leaving the whole family hungry and empty-handed. I don’t think we can start again for many years. Everything is under water and even if the river recedes, the water will be there for a long time.”

The main farming provinces of Punjab and Sindh have been deluged by the floods. Mohammed Ibrahim Moghul, chairman of the farmers’ organization Agri Forum Pakistan, stated, “We have lost 20 percent of our cotton crops. The destruction of corn, rice, sugarcane, vegetable crops and fish farms are enormous as well.” He estimated agricultural losses of about $3 billion. Pakistan’s export sector is expected to be hit hard by the damage done to cotton, sugarcane, rice and maize

 

[Dark Angel]

The export sector is the principal source for Pakistan’s foreign exchange reserves. Pakistan’s export target for this year had been $21 billion, out of which agriculture and textiles were expected to account for nearly three-quarters of the target. The floods will have disastrous consequences for the textile sector, which alone accounts for about 60 percent of exports. Out of the targeted output of 14 million bales of cotton, at least 2 million bales have been lost, according to textile industry officials.

“The floods have eaten 3 million tons of cotton—over 20 percent of our 14 million bales for this year,” said Ashfaq Hasan Khan, a former government economic adviser. “It will negatively affect by 25 percent large-scale manufacturing and ultimately impact on exports.” Arif Hussain, an agriculturalist from Punjab province, estimated that nearly $1 billion worth of the cotton crop has been destroyed and stated that this would be the most destructive factor to the Pakistani economy. While Pakistan is the world’s fourth largest cotton producer, it may now be forced to import more than 3 million bales of cotton in order to feed its textile industry.

The floods have also had an enormous impact on Pakistan’s sugar cane crop. The country had been struggling through white sugar crises before the floods. Pakistan has already imported over 500,000 tons of sugar in August, and will now have to purchase much more as the floods have damaged or destroyed around 80,000 hectares of sugar cane crop valued at $600 million. Pakistan’s annual demand of white sugar is 4.2 million tons.

Before the onset of the floods, the next crop was expected to produce 3.8 million tons of white sugar. Pakistan’s food ministry expects output of refined sugar to fall by at least half a million tons this season after the floods destroyed a large amount of the crop. According to Xinhua, “Market gurus are expecting that in the months to come the cost of sugar would increase many times to around 125 to 130 rupees per kg almost double that of now.”

Nearly $250 million worth of the rice crop and an even larger amount of the maize crop have been destroyed. The floods have led to losses of around $500 million in vegetable, fruit and fodder crops. At least $200 million worth of wheat stocks have been damaged, mostly in the province of Sindh. According to Xinhua, “The wheat seed stock with the farmers community had also been washed away by the floods and they have no seed for sowing in the next season, which will create the most desperate conditions for the farmers.” The floods have led to a shortage of fresh vegetables and fruit in the country, forcing Pakistan to import dozens of trucks of potatoes daily from India ever since August 16.

Millions of head of livestock have also been killed or threatened by the floods. According to Sher Mohammad, director general of Pakistan’s Livestock Department, at least 400,000 animals in 11 districts have been affected, but other districts have yet to report back on their losses. The Livestock Department also stated that well over $100 million worth of cattle were lost in the floods. Pakistani officials are asking for at least $2.3 million for the treatment of affected animals, according to Dawn. A statement released by the UN Food and Agriculture Organization (FAO) stated, “Some 200,000 cows, sheep, buffalo, goats and donkeys have already been lost, but the toll will possibly be in the millions including poultry.”

 

[Neutral]

Where does it says the economic difficulty is due to Kashmir ??

You guys are even more obsessed with Kashmir, then we are.

By the way great logic.

i also did'nt said its the only cause ..its the commutative effect of many factors and this is one major factor

Why Kashmir is linked?

There was a recommendation by your some newspaper to your government...that to increase Pak defense budget(~4 billion $) to match the Indian defense budget(~33 billion $)!

Now Normal People's with brains can tell the cause this type of suggestion....that Pakistan has fought 3 wars with India

OVER WHAT??

KASHMIR

Now if Pakistan gives up Kashmir then no need of increasing defense budget plus much better trade relations with India and 100s of other benefits!

Samjhae Nadaan

 

[TaimiKhan]

i also did'nt said its the only cause ..its the commutative effect of many factors and this is one major factor

Why Kashmir is linked?

There was a recommendation by your some newspaper to your government...that to increase Pak defense budget(~4 billion $) to match the Indian defense budget(~33 billion $)!

Now Normal People's with brains can tell the cause this type of suggestion....that Pakistan has fought 3 wars with India

OVER WHAT??

KASHMIR

Now if Pakistan gives up Kashmir then no need of increasing defense budget plus much better trade relations with India and 100s of other benefits!

Samjhae Nadaan

Its a suggestion by some hawkish newspaper, similar kind of hawkish ideas are represented by other side newspapers and media also, it doesn't means they have to implement it. Its their views, not decisions.

And Kashmir is not the only cause of dispute and wars between India and Pakistan, there are other reasons too and in future more reasons will come up.

India wants and wishes for regional hegemony, so that all plays by its rules, which Pakistan will not follow, thus for that a strong military is necessary to thwart Indian ambitious regional designs.

Hope the nadaani you have shown in understanding regional & global strategic issues is rectified and learn how countries play with each other.

 

[footmarks]

India wants and wishes for regional hegemony, so that all plays by its rules, which Pakistan will not follow, thus for that a strong military is necessary to thwart Indian ambitious regional designs.

What the...How do you people come to such an opinion ?? And what about Global hegemons like China & US??? you are happily towing their lines, selling off your country to them. What have we asked you to do? You are blinded by your Govt. implanted and religious supplanted hatred towards India, nothing else. We have no expansionist agenda, we are just not willing to give a single inch of our land to anybody.

 

[TaimiKhan]

What the...How do you people come to such an opinion ?? And what about Global hegemons like China & US??? you are happily towing their lines, selling off your country to them. What have we asked you to do? You are blinded by your Govt. implanted and religious supplanted hatred towards India, nothing else. We have no expansionist agenda, we are just not willing to give a single inch of our land to anybody.

Well its not your land, its a disputed land. Wanna keep eyes closed, be our guest, it doesn't matters to us.

And after having access to international news sources, information sources as well as without any censorship media, we can very well make up our mindset about whomever we want, we don't want our Govt and Mullahs to tell us what to think.

Well if they had bought us, you won't be finding people talking negative against them, burning down US flags in protests and stuff like that. As these things happen, it does shows, we have not been sold nor will be, except for some traitors sitting in the corridors of power.

So what the politicians do, doesn't means the ordinary people also think like.

India asking to forget Kashmir, similarly other issues to be resolved as per its liking, they do represent hegemonic designs, as a hegemonic neighbor would like to have things go its way, rather then resolving it mutually.

 

[footmarks]

Well its not your land, its a disputed land. Wanna keep eyes closed, be our guest, it doesn't matters to us.

And after having access to international news sources, information sources as well as without any censorship media, we can very well make up our mindset about whomever we want, we don't want our Govt and Mullahs to tell us what to think.

Well if they had bought us, you won't be finding people talking negative against them, burning down US flags in protests and stuff like that. As these things happen, it does shows, we have not been sold nor will be, except for some traitors sitting in the corridors of power.

So what the politicians do, doesn't means the ordinary people also think like.

India asking to forget Kashmir, similarly other issues to be resolved as per its liking, they do represent hegemonic designs, as a hegemonic neighbor would like to have things go its way, rather then resolving it mutually.

By this definition, Pakistan is as hegemonic as India & India is as hegemonic as China.

And for remarks of "Traitors sitting in the corridors of Power", well, its the people like you who gave them moral support. In your previous post, you were yourself saying "we need a strong Military"

 

[TaimiKhan]

By this definition, Pakistan is as hegemonic as India & India is as hegemonic as China.

And for remarks of "Traitors sitting in the corridors of Power", well, its the people like you who gave them moral support. In your previous post, you were yourself saying "we need a strong Military"

Well, i don;t believe Pakistan has asked India for resolution of matters should be as per its liking, rather it should be joint. Do let me know where Pakistan emphasized that resolutions should be as per its liking, i will stand corrected.

Well, we haven't supported such people nor have I.

And strong military to repel any aggressive country, not to play politics.

 

[TopCat]

Unfortunate indeed.Pakistan should open up its market for Indian investments,the way in Afghanistan.A steady flow of capital for investment will surely follow.That definitely help to a great extent to stabilize the current economic turmoil ,reduce the tension between the two countries and pave the path for long term peace and development in South Asia.

You are over estimating yourself.

 

[TaimiKhan]

read the title of this thread again. the country is on the brink of economic breakdown, as per your finance minister. And you keep regurgitating the age old "strong military" rhetoric.

Ask yourself, if its time to change the approach. Time for some practicality, maybe?

Well i am well aware of the title, but it seems you have missed to whom on which point i replied.

And in whatever our conditions are right now, military or its budget has no role to play, its the incompetence of the people who are running the country that we are in such dire problems.

And the strong military comment should be taken in context to the post to which it was replied to.

 

[gregarious]

we cannot blame a few people for the failure of the whole nation. I think politicians in India are even more corrupt than their Pakistani counterparts, so is the case with China. India and China have still managed to grow despite their corrupt systems.

IMO corruption cannot be elimianated, alteast from the subcontinet, its in our blood. We have to figure out a way to grow with it. Just blaming the politicians will not help. A system needs to evolve which would over shadow corruption.

 

[su-47]

we cannot blame a few people for the failure of the whole nation. I think politicians in India are even more corrupt than their Pakistani counterparts, so is the case with China. India and China have still managed to grow despite their corrupt systems.

IMO corruption cannot be elimianated, alteast from the subcontinet, its in our blood. We have to figure out a way to grow with it. Just blaming the politicians will not help. A system needs to evolve which would over shadow corruption.

This bloody attitude has to change! Corruption is not in our blood, but in our heads! There are thousands of honest politicians in India who work for the welfare of the nation, but we ignore it in front of the corrupt babus. Corruption is not determined by race, but by the culture of the people. Its time to cut out this part from our culture forever.

What we need to change is our mindset. Centuries of domination by foreign powers followed by decades of abject poverty fostered in us a sense of helplessness and an 'every man for himself' attitude. That is why corruption is not only practiced, but tolerated.

Look at India now. Corruption is no longer passed off as easily as it was before. Attitudes are changing as we grow more confident as a nation and as our patriotism grows. Look how the CWG corruption was exposed and is being dealt with, see how the Indian govt is looking to tax black money held in Swiss bank accounts. We are making progress.

What we need is to stop accepting corruption as the norm. we as a people should do what is within our power to help expose corruption and show the evils of it to the public. Change this sense of helplessness. We have achieved a lot, and its time we adopt a western mindset when it comes to dealing with corruption. Absolute intolerance. Treat corruption as treason. You will see it removed from India if the people, the common masses, demand accountability and exercise their rights to the fullest.

 

[su-47]

Well i am well aware of the title, but it seems you have missed to whom on which point i replied.

And in whatever our conditions are right now, military or its budget has no role to play, its the incompetence of the people who are running the country that we are in such dire problems.

And the strong military comment should be taken in context to the post to which it was replied to.

i think you missed my point. what i meant is, how can you keep a strong military when the economy is in shambles? the talk of a 'strong military' should only come when there is an economy to back it up.

Prioritise your needs: decide if it would be worth reducing military budget for a few years in order to free up more money to be used in the economy.