Knowledge
Class News: Prime Minister Mian Shahbaz Sharif
Chairs First Federal Cabinet Meeting, Declares "War Cabinet" to
Tackle Economic Challenges
In a worrisome
revelation, the details of the first meeting of the federal cabinet, chaired by
Prime Minister Mian Shahbaz Sharif on Wednesday, highlighted the dire state of
Pakistan's economy. Acknowledging the seriousness of the challenges at hand,
Prime Minister Sharif referred to his cabinet as a "war cabinet" and
pledged to address the issues of poverty, inflation, unemployment, and economic
hardships faced by the people.
Finance Minister Muftah
Ismail, in a joint press conference with Information Minister Maryam Aurangzeb,
expressed concerns over the economic situation and blamed the previous
government's decision to provide petrol and diesel subsidies for jeopardizing
the country's economic future. The subsidies, costing Rs. 96 billion in May and
June alone, which is double the cost of running a civilian government in
Pakistan, were deemed unsustainable.
Furthermore, Finance
Minister Ismail revealed that the country's debt burden had significantly
increased, with more than Rs. 20,000 billion borrowed over 15 years. During the
previous government's tenure, the government debt increased from Rs. 24,953
billion to Rs. 42,745 billion, and the total foreign debt surged from Rs.
7575.4 billion to Rs. 101,023 billion, resulting in a trade deficit of Rs. 4343
billion. The number of unemployed people also spiked from 3.5 million to 9.5
million.
Finance Minister
Ismail, who left for the United States on Thursday to negotiate with the
International Monetary Fund (IMF), disclosed that the IMF had agreed to restore
the $6 billion bailout package, including fuel subsidies and tax amnesty
refunds, but with imposing stringent conditions. These conditions include
increasing petrol and electricity prices, imposing new taxes, eliminating
revolving electricity debt, and ensuring financial savings.
In order to address the
economic crisis, the government is left with no choice but to take unpopular
decisions, including a potential increase of Rs. 20 per liter in petrol and
diesel prices to offset the negative effects of the previous government's oil
subsidies. The government, however, has committed to absorbing Rs. 30 per liter
from its own resources to partially alleviate the burden on the people.
Concessions on loans and safe deposits from friendly countries such as China and
Saudi Arabia are also being considered to bridge the economic gap and foreign
exchange deficit.
In light of these
challenges, there is a growing call for all political parties, including the
PTI, to come together and form a long-term economic pact for the wider interest
of the country, despite their ideological differences, to ensure sustained
economic development regardless of changes in government. The nation awaits the
outcome of the government's efforts to tackle the economic crisis and provide relief
to the people.
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