New Delhi, March 18: Despite the government’s assertions of stability and reform in Pakistan’s economy, the reality on the ground raises significant doubts. Experts indicate that deeply rooted structural weaknesses, particularly the ongoing decline in production capacity, continue to impact the country’s economic situation.
According to a report by The Express Tribune, the government has touted its achievement in avoiding default. However, analysts argue that the broader economy remains fragile, with no clear signs of sustainable improvement.
Key economic indicators consistently point towards pressure, including sluggish growth, high inflation, rising unemployment, and increasing debt.
Experts highlight that the most pressing issue is the weak production capacity, which limits the country’s sustainable economic growth. Years of policy neglect and poor governance have steadily weakened Pakistan’s production system. Industrial and agricultural production, considered the backbone of economic activities, has either stagnated or declined.
The report notes that in a data revision for 2021, the industrial sector’s contribution to GDP fell from 20.9% to 19.5%, reflecting structural decline. The large-scale manufacturing sector continues to struggle, while the agricultural sector faces rising costs, falling prices, and climate-related challenges. Insufficient policy support has placed additional pressure on farmers, leading to increased poverty in many areas.
The weakened production base has also exacerbated external imbalances. Limited export capacity and growing dependence on imports have strained foreign exchange reserves, forcing the country to borrow repeatedly. Public debt has surged over the past two decades, raising concerns about its sustainability.
The devaluation of the currency has intensified these issues, leading to rising inflation and diminished purchasing power, resulting in increased economic hardships.
Experts warn that the economic crisis is now affecting the social fabric as well. Rising poverty, food insecurity, and inequality are deepening divisions within society and heightening the risk of instability.
The report also states that government-supported initiatives, such as the Special Investment Facilitation Council (SIFC), have so far failed to deliver solid results, raising questions about their effectiveness.
Analysts argue that the continued reliance on short-term measures like subsidies, welfare spending, and asset sales has further weakened the economic framework instead of addressing core issues. They emphasize that without immediate and comprehensive reforms to rebuild production capacity, improve governance, and strengthen the business environment, Pakistan’s economic challenges may deepen further.
My name is Ganpat Singh Choughan. I am an experienced content writer with 7 years of expertise in the field. Currently, I contribute to Daily Kiran, creating engaging and informative content across a variety of categories including technology, health, travel, education, and automobiles. My goal is to deliver accurate, insightful, and captivating information through my words to help readers stay informed and empowered.
Leave a Comment