Where there is a will there is a way. And that strong
will of the present government to get rid of the foreign loans seems to
have paved the way to achieve the formidable target to get out of the
debt trap, which used to be a nightmare of the whole nation
If the human memory is not too short one may recall
the days when the country had reached a situation where it was not in a
position even to meet the liabilities of the debt servicing what to
speak of the debt retirement. Despite the increasing light in the tunnel
there is a coterie of the people who are still not mentally prepared to
accept the ground realities. Despite strongly improved economic
fundamentals i.e. internationally acknowledged sovereign credit rating
of the country, improved home remittances which are showing tremendous
confidence of the remitting overseas Pakistanis and unprecedented growth
in foreign exchange reserves of the country, the habitual critics
continued to express their doubts over capacity and intention of the
policy makers of putting the national economy on the track.
Previously, the government collected peoples hard
money out of the pockets by raising the touchy slogans like "Qarz
Utaro Mulk Bachao" however, they disappeared from the scene by
adding yet another burden of the domestic loan on the camel's back...
Consequently, the national economy has to bear extra burden and to pay
huge interest on the money collected in the name of national Debt
Retirement Program launched previously.
Now when the huge foreign debt amount to $38 billion
has been stopped to grow further, and there are signs that the mounting
debt has started subsiding. Some quarters are still expressing their
doubts about the debt retirement program of the present government. They
must have their own parameters to weigh up things.
We, however, must recall the days when the
governments in the past were always pursuing the international donors to
get more and more loans to meet day to day expenses. Whenever they
succeed in getting new loans they used to make head lines in the
newspapers next morning.
The situation is obviously different now. Unlike the
previous subdued attitude, we are loudly thinking of getting rid of the
foreign loans. President Gen. Pervez Musharraf as well as the governor
of the State Bank of Pakistan has said that Pakistan now in a position
that it does not need IMF loan and hopefully it will get rid of the debt
trap in next two-three years. "However, we will have to work more
vigorously to pass on the benefit of the economic development to common
people", the president said.
While outlining the economic performance of the
military regime during past three years recently, he said that Pakistan
had attained the level from where it could take off for a journey to a
The will to get rid of the foreign debt must be the
desire of every Pakistani for which we have to further strengthen
country's ability to repay debt by improving the earning capacity.
It is for the first time that the Central Bank is
thinking in terms of investing 10 per cent of its total foreign exchange
reserves with an international investment bank. According to report the
central bank is also looking for an international consultant to carry
out its investment plan safely.
It is believed that the income out of this investment
may be tied up with the debut retirement which will further provide a
breathing space to the national economy.
For achieving this cherished goal not only we have to
consolidate all our resources but have to develop a national consensus
for achieving the most cherished goal of the economic independence for
the people of this country. In overall terms, the total stock of
Pakistan's external debt and liabilities should gradually decline. In
this regard, the current account surplus posted during the last two
years and the substantial gains from recent developments in the external
sector i.e. higher remittances, forex reserves build up are very
Country's foreign exchange reserves continue to grow
handsomely reaching to the level of $9.452 billion in the last week of
the first month of second half of the current financial year.
The State Bank of Pakistan improved it reserves by 74
million dollars to touch the record 8.015 billion dollars for the first
time in the history. The holding of the foreign exchange reserves by the
commercial bank was estimated at $1.437 billion in the last week of
Commenting on the improved financial conditions of
the country, Dr. Ishrat Husain, Governor State Bank has said that
Pakistan, having good reserves of foreign exchange can take its own
decisions and can avoid conditionality attached by the donor agencies.
The tremendous increase in home remittances by
overseas Pakistan through official banking channels was one of the
important factor which not only helped stabilizing the national foreign
exchange reserves but also indicate restoration of their confidence into
the policIes of the government. Decision to freeze the foreign currency
accounts in 1998, shattered the confidence of the overseas Pakistani who
consequently started sending money through moneychangers.