Zakii borrowing and borrowing has been the solution for decades and now we have come to a point where we borrow to pay of the interest.
This isn't how loans on a national level are supposed to work. That we can barely pay interest on the loans we do have, alludes to the inability of successive governments to effectively invest the money. Loans procured by the Pakistani government are lost to greedy higher ups and the general overextended bureaucracy of our highly inefficient government. In the end, it is more a year end bonus for government officials than much needed funding for infrastructural projects.
Infrastructural development is really what these loans are for. The reason many people dislike the IMF is because it attaches so many conditions on the receivers' of it's loans. But the IMF does so to avoid exactly the predicament every county loaning money to Pakistan finds it's self in. We have the need for billions, but those billions are not supposed to be used to pay off previous debts, government salaries and retirement packages, and to finance the general aggrandizing of the Pakistani prestige through arms purchases. If that is the eventual home of the billions we are to receive as loans, then it is better to not receive them at all.
Investment in power generation, irrigation, roads, academics and healthcare drive economic growth. The billions invested in these sectors provide an exponential return over many decades. If this government plans to be any different than those that were in power previously, then it has to put the needs of the general population above those of the luxurious lifestyle of high up government officials. But judging from the history of Pakistani politics, we will more than likely take on more loans, waste them on projects with a nonexistent return on investment and be back begging next year.
As far as the potential tax base that is hidden beneath the surface is concerned, it is largely irrelevant at this point. After 60 odd years of letting most people live a tax free existence, the government isn't going to risk angering an already splintered country. Inevitably, the general population of all nations only pay attention to what they must give up, not to the idea that such subsidies are luxuries and not basic rights to begin with. By letting generations of Pakistanis get away with paying no tax with no negative consequences, the government has made this a basic right simply by negligence. For the foreseeable future, the tax base will remain small and the government will have to work around that. Doing so will require an efficient allocation of aid and loan money...and in a never ending circle, I can paste the first part of my post in this space, which pretty much sums up Pakistan.