Read on Twitter
On the two years anniversary of elections 2018, it merits some attention as to about what PTI promised vs. what it delivered; what it claims vs. what is the ground reality.
Since everything can't be incorporated in one thread, so I will just focus on economic indicators. /1
Since everything can't be incorporated in one thread, so I will just focus on economic indicators. /1
PTI came to power in 2018 on the back of accusations that PMLN has ruined Pakistan's economy and they'll fix it. In one year or so, country's annual GDP growth rate went from 5.8% to 1% (2019). -- Source: World Bank
In 2013, when the PMLN govt. assumed power, annual GDP growth rate was 4.4% and every year it steadily kept growing. Nothing extraordinary but enough to sustain Pakistan's population. /3
In 2008, when Gen. Musharraf was finally on his way out and PPP assumed power, annual GDP growth rate was 1.7%. PPP raised it to 4.4% in their five years (a period which generally is considered nothing to write home about). /4
The last time Pakistan's annual growth rate was 1% before 2019, it was 1997 (per WB figures). So essentially after a period of steady growth in 10 years, our economy is where it was 23 years ago within a couple of years of PTI rule. /5
What that growth meant for Pakistan? In layman's terms, it meant the size of Pakistan's economy was expanding and there was something in it for every sector. In PTI's one year, it reduced from 314b (2018) to 278b (2019) and is shrinking further. /6
Now let's look at inflation (actual is always higher than WB or GoP figures). In 2018, inflation was 2.5% and it rose to 8.6% in 2019 (it is already in double digits now). /7
When PMLN came to power in 2013, official inflation figure was 7% . /8
PPP started in 2008 with over 13% inflation and brought it down considerably (particularly with focus on farmers). PMLN's major subsidies went to industrial sector but they also controlled inflation somehow. It has consistently surged in the last two years. /9
When Gen. Musharraf took over in 1999, Pakistan's inflation rate was ~6%. When he left, it was 13%. That's the reality of his banking & finance led economic model led by Shaukat Aziz. Both PPP and PMLN brought is somewhat under control in next 10 years. Not anymore. /10
Another keenly contested point is of external borrowing (with some merit). However, if PTI govt. has taken 44% of Pakistan's total debt in just two years, they are outpacing their predecessors. /11
But if you look at the debt-to-GDP ratio, Pakistan and India are pretty similar (~70%) and U.S. has over 106%. That means that foreign loans are not as much of a problem in the capitalist system, but you can always debate where utilization priorities are right or wrong. /12
Pakistan's economic indicators (negative GDP growth, double digit inflation & rising debts) are currently worse in the country's history. COVID-19 has made the projections worse.
No matter what the govt. claims, the downslide started well before the current pandemic. /13
No matter what the govt. claims, the downslide started well before the current pandemic. /13
The govt has been claiming reduction in current account deficit as a victory, but it has mainly resulted in industrial sector stagnation since their raw materials (coupled with volatile economic condition) dried up.
The impacts will far outlast the pandemic itself. /14
The impacts will far outlast the pandemic itself. /14
PTI govt. has also been claiming increase in exports but it hasn't really changed in $ terms. If you take into account currency devaluation, it has actually gone down.
This was the main issue in PMLN govt. too. Most of the growth in their time was import-led (unsustainable). /15
This was the main issue in PMLN govt. too. Most of the growth in their time was import-led (unsustainable). /15
PTI govt's economic 2018 plan included:
1) Recovery through ruthless accountability
2) Return of looted money stashed abroad
None of that has materialized. Instead, currency devalued, inflation & utility bills doubled, indirect taxes increased.
Hence we are where we are./16
1) Recovery through ruthless accountability
2) Return of looted money stashed abroad
None of that has materialized. Instead, currency devalued, inflation & utility bills doubled, indirect taxes increased.
Hence we are where we are./16
PMLN's tenure had its issues. Their economic policies lacked the vision for long-term sustainability and structural reforms. One can take issue with the ill-advised development projects, but at least they had some plan to keep the system running.
PTI has ground it to halt. /17
PTI has ground it to halt. /17
What next in the remaining three yrs? I suspect this govt. will continue to do what they have been doing & insist that everything is hunky dory.
The impact of pandemic will take several years to subside anyways. That means more economic turmoil, inflation & unemployment. /18
The impact of pandemic will take several years to subside anyways. That means more economic turmoil, inflation & unemployment. /18
Look for alternatives & prepare for worse. If you keep looking towards the govt. in the hope for miracles, please know that the govt. itself is waiting for miracles.
Hope is good, but hope can't be a strategy. Handsomeness is good, but it can't be a panacea either. /19
Hope is good, but hope can't be a strategy. Handsomeness is good, but it can't be a panacea either. /19
The world after COVID-19 will not be the same as it was before. Economies will also change (it'll be worse before it gets better). Our govt. will assure you that we wouldn't be as impacted by others, but they are lying. So brace for impact. /20 *end* https://www.worldbank.org/en/news/press-release/2020/06/08/covid-19-to-plunge-global-economy-into-worst-recession-since-world-war-ii
