Thread by @MiftahIsmail

Having run up the largest deficits and public debt in our history, PTI is now trying to set a narrative that it is paying back national debt. It really takes some gall to spin this false narrative. In this thread I will try debunk this completely illogical and baseless claim. ➡️

No PTI supporter says that PPP paid back loans of Musharraf era, even though some of his debt was re-rolled during PPP’s tenure. Since our debt went up by ~ Rs 8000 bil during PPP’s 5 years (08-13) it means obviously that PPP didn’t pay back any debt but incurred more debt.
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When PMLN came to power in 13, our public debt was Rs 14292 bil and when we left in 18 it was Rs 24593. We too re-rolled or re-issued previously issued debt but of course we didn’t pay back any debt but added Rs 10,661 bil in debt in our 5 years. That’s Rs 2,132 bil per year. ➡️

In FY 12/13 our tax collection was Rs 2049 bil & debt Rs 14293 bil. So our tax income was 14.3% of our debt. In 17/18 our tax collection was Rs 4065 b and debt was Rs 24,953 so we left govt with tax income of 16.3% of debt, an improvement of 14% in our ability to service debt. ➡️

In 2.5 years, PTI has taken debt to Rs 37,457 bil, adding a whopping Rs 12,863 bil to debt. That's 40% of all debt incurred by Pak in 71 years. 40%. That’s every year as much debt as was added from Liaquat Ali Khan to Shaukat Aziz. Rs 5145 bil per year. 241% higher than PMLN.
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In June 2020 Pak’s tax income to debt ratio was 11.9%, below the ratio PPP left in 2013 and 27% below the ratio PMLN left in 18. (The Dec 2020 number cannot be used as both taxes & deficit are more heavy in the 2nd half but it’s just as harrowing a depiction of PTI ineptitude)➡️

PTI defenders claim falsely that the dangerously rapid increase in debt under PTI is due to devaluation. Not true. In June 18 Pak’s external debt was $70.24 bil and dollar was @ Rs 121.5. As of of Dec 31, 2020, the external debt was $82.37 bil & dollar was for Rs 159.6 ➡️

Devaluation of $70.2 bil has added Rs 2673 b to debt and the remaining Rs 10,190 bil is due to PTI’s deficits & loans. Devaluation makes forex loans more costly; but tax collection increases, due to inflation pushing up sales & income taxes & higher custom duties on imports. ➡️

The reason for the huge increase in debt is the huge rise in budget deficits under PTI, exacerbated by stagnant taxes. The average deficit under PMLN was 5.5%, & we left at tax to GDP at 11.74%, the average deficit under PTI has been over 8.6% & tax to GDP has declined to10.4% ➡️

PTI govt has not paid back a single rupee or dollar of Pakistan’s debt. It has only increased it. When a government bond is due it only re-issues more bonds. Similarly for bank loans. If unable to re-roll a debt, it borrows from elsewhere. Not one rupee has been paid back.//