, 17 tweets, 7 min read Read on Twitter
1/Deficit: In the first half of fiscal year, July to Dec 18, budget deficit was 2.8% of GDP. This is higher that any July to Dec period of PMLN’s 5 year. Where is the deficit reduction PTI talked about? Where is their much hyped austerity. Why are current expenses out of control?
2/ Revenue: In spite of a mini budget in Sept, where taxes were increased by Rs 180 bil and tax collection targets reduced, govt is still short by Rs 173 bil. PM Khan had promised that he will double revenues. Yet they are behind speed PMLN had achieved.
3/ Debt: PTI govt has 2.24 trillion of new debt up to Nov, 2018. A dubious record. In 71 years of Pak all govts combined took total debt of less than Rs 25 trillion. PTI in only 5 months has contracted Rs 2240 bil. At this speed in 5 years it will double Pak’s debt of 71 years.
4/ Exports: In spite of a record devaluation of 35%, exports from July to Nov were actually below their level last year and only in December the exports increased a bit, so that they are only up by 2% for the first half. Compare this to 13% growth in exports last year under PMLN.
5/Imports: Even after the huge devaluation our imports are still high. Yes they have reduced from last year but only by 2% and that too due to the large decrease in the price of oil internationally. The decreased import of machinery is signalling low investment and recession.
6/ Export Refunds and Rebates: I am told the last refund paid to the exporters to ease their working capital problems was done by the PMLN government 7.5 months ago. PTI government still hasn’t paid any refunds and rebates
7/ GDP: Last year growth was 5.8% and expected 6.2% this year. All intl institutions were optimistic about Pak’s prospects. Now growth forecast brought to 3%. This is a loss of Rs 1400 billion to the economy. Because of PTI’s mishandling, economy has been forced into a recession.
8/ Stocks: Since 2017 our stock market has lost almost half its value in dollars. So PTI has caused our corporate & business sector, including govt-owned companies, a loss of about $40 billion. PTI celebrates loans of $3 from here and there yet has cost Pak stocks $40 bil.
9/ Jobs: What happened to 1 crore jobs? How can you have new jobs when growth is only 3%. Economists estimate that you need 8% growth to provide 20 lakh new jobs annually. At 3% you will increase unemployment by about 7 to 8 lakhs people per year.
10/ New homes: The real estate & construction sectors are at a standstill. Private sector housing sector has caused huge unemployment & no new projects are being constructed. Far from 5 mil new houses PTI has almost brought to a halt homes that were being built by private sector.
11/Printing of Money: In the first five months to Nov PTI has borrowed more than Rs 1400 billion from the State Bank. Compare this to Rs 288 billion in the same period last year. What’s borrowing from the State bank? It is printing new money. This will increase inflation rapidly.
12/ Devaluation: Why is inflation rising rapidly and is higher now than the last four years? Because of huge & repaid devaluation. Last year when there was political uncertainty and international environment, including FATF,had turned against us, our government devalued by 10%.
13/ This was like taking two aspirins for your headache. When caretakers came they devalued by about 7% more. That’s like taking a third aspirin for a bad headache. But since then PTI has overdosed and taken 9 aspirins.
14/ What Tabdeeli Sarkar doesn’t get is that this will not cure the headache. This will make you more sick. After a dollar value of rupee 125, we are just importing inflation into Pakistan. And even exports can’t be increased right away.
15/ Interest Rates: Three years ago, State Bank’s Policy Rate, which is the benchmark interest rate, was the lowest Pakistan has had in 40 years. Since our government left SBP’s Policy Rate has been increased from 6.5% to 10%, an increase of more than half in just a few months.
16/ This has caused much hardship to businesses. But it has also increased government borrowing costs by over Rs 400 billion. So we are today paying more than one hundred and twenty crores of extra interest per day because of PTI’s govts actions. Some Tabdeeli.
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