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PPP, PML-N split termed bad for economy
ISLAMABAD: Political separation of the country’s two major political parties Pakistan Peoples Party (PPP) and Pakistan Muslim League Nawaz (PML-N) has been termed as bad and ‘big blow’ to the ailing economy of the country.
Under the current scenario, IMF Programme will likely remain suspended and even lending from World Bank and Asian Development Bank will become more difficult due to the separation and confrontation between the two political parties of the country, said the economic experts on Friday.
A national political dialogue for revival of economy initiated by the PPP-led coalition government in the center met failure on Friday when PML-N leadership expressed dissatisfaction over the progress on dialogue.
Commenting on the major political development, renowned economist and former economic advisor to the Ministry of Finance Dr Ashfaq Hassan Khan termed the latest political development as dangerous for the economy and said “the situation would not enable the government even to think of initiating any major reform.” Dr Khan said that it would become more difficult for the government to initiate any of the key economic reforms especially the tax reforms and maintaining the relations with Pakistan’s major lending partners such as International Monetary Fund (IMF), World Bank and Asian Development Bank.
He said PML-N bailed out the PPP government when it was facing political pressure in the name of 10-point agenda and after wasting 45 days, “now they have quit the talks — with nothing to offer to the poor.”
“The non-serious attitude on both sides was quite visible and it was feared even before the end of deadline that this dialogue would meet failure,” he said.
He was of the view that economic situation in the country is already alarming and new political confrontation would add fuel to fire and badly impact the already ailing economy.
He said that $11.3 billion IMF programme, already facing suspension, is likely to remain suspended and non-availability of Letter of Comfort (LoC) from the IMF for obtaining fresh loans from the World Bank and Asian Development Bank would increase the economic and lending uncertainties for the country. He said that LoC from IMF is very much needed for fresh loan from WB and ADB and new confrontation between the two major political parties would endanger the availability of LoC from IMF for these institutions.
Dr Ashfaq said that both the political parties have wasted 45 days despite the fact oil prices are going up and “no one paid attention to this issue and did not try to agree on a mechanism to save the economy from a looming oil shock.”
Saqib Sherani, Economist and former Principle Economic Advisor to Ministry of Finance termed this political development as a major blow to the economy and said that even before the announcement of the separation of PML (N) from PPP, the Karachi stock market dived by over 400 points, causing a big loss to investors.
He said that this political development would increase the uncertainty for Pakistan’s economy and hurt the IFI’s and investor’s confidence in the economy. “It was hoped that this dialogue would help revive the ailing economy and provide a path for putting it on sustainable development but things have turned bad.” He said that the relations with major lenders of the country where facing many challenges and this political blow would further hurt these relations as non-availability of the much-needed political support not to enable the government initiate economic reforms. staff report.
I think wave of change of regimes already reached in Pakistan from Egypt,Tunis,Lybia etc.The solution is that Miltery should take over for three month or national government should be formed for new elections.
ISLAMABAD: Political separation of the country’s two major political parties Pakistan Peoples Party (PPP) and Pakistan Muslim League Nawaz (PML-N) has been termed as bad and ‘big blow’ to the ailing economy of the country.
Under the current scenario, IMF Programme will likely remain suspended and even lending from World Bank and Asian Development Bank will become more difficult due to the separation and confrontation between the two political parties of the country, said the economic experts on Friday.
A national political dialogue for revival of economy initiated by the PPP-led coalition government in the center met failure on Friday when PML-N leadership expressed dissatisfaction over the progress on dialogue.
Commenting on the major political development, renowned economist and former economic advisor to the Ministry of Finance Dr Ashfaq Hassan Khan termed the latest political development as dangerous for the economy and said “the situation would not enable the government even to think of initiating any major reform.” Dr Khan said that it would become more difficult for the government to initiate any of the key economic reforms especially the tax reforms and maintaining the relations with Pakistan’s major lending partners such as International Monetary Fund (IMF), World Bank and Asian Development Bank.
He said PML-N bailed out the PPP government when it was facing political pressure in the name of 10-point agenda and after wasting 45 days, “now they have quit the talks — with nothing to offer to the poor.”
“The non-serious attitude on both sides was quite visible and it was feared even before the end of deadline that this dialogue would meet failure,” he said.
He was of the view that economic situation in the country is already alarming and new political confrontation would add fuel to fire and badly impact the already ailing economy.
He said that $11.3 billion IMF programme, already facing suspension, is likely to remain suspended and non-availability of Letter of Comfort (LoC) from the IMF for obtaining fresh loans from the World Bank and Asian Development Bank would increase the economic and lending uncertainties for the country. He said that LoC from IMF is very much needed for fresh loan from WB and ADB and new confrontation between the two major political parties would endanger the availability of LoC from IMF for these institutions.
Dr Ashfaq said that both the political parties have wasted 45 days despite the fact oil prices are going up and “no one paid attention to this issue and did not try to agree on a mechanism to save the economy from a looming oil shock.”
Saqib Sherani, Economist and former Principle Economic Advisor to Ministry of Finance termed this political development as a major blow to the economy and said that even before the announcement of the separation of PML (N) from PPP, the Karachi stock market dived by over 400 points, causing a big loss to investors.
He said that this political development would increase the uncertainty for Pakistan’s economy and hurt the IFI’s and investor’s confidence in the economy. “It was hoped that this dialogue would help revive the ailing economy and provide a path for putting it on sustainable development but things have turned bad.” He said that the relations with major lenders of the country where facing many challenges and this political blow would further hurt these relations as non-availability of the much-needed political support not to enable the government initiate economic reforms. staff report.
I think wave of change of regimes already reached in Pakistan from Egypt,Tunis,Lybia etc.The solution is that Miltery should take over for three month or national government should be formed for new elections.
