PESHAWAR: Pakistan is just one of the two, three countries in the world whose debt-to-GDP ratio fell during the coronavirus pandemic, says Adviser to the Prime Minister on Finance and Revenue Shaukat Tarin.
He was addressing the media outside the provincial election commission office here on Monday after registering his vote in Mardan. “You can’t view loans only in terms of magnitude,” he said. “You have to compare them with our GDP growth, which is between five percent and seven percent.” “We are using these loans to boost the State Bank of Pakistan’s reserves. In 2018, our reserves were $8b now they are $20b.”
Referring to Punjab Governor Chaudhry Sarwar’s statement on IMF’s loan conditions, Tarin said, “Sarwar can’t be called an economist.” He added that these statements are made in public. “Drawing room economists and television analyst talk without any research. Our debt-to-GDP ratio and the net debt has actually decreased.”
Tarin said when the PTI government came into power, it had no other option but to go to the IMF. “Prime Minister Imran Khan went to Saudi Arabia, the United Arab Emirates, Qatar and China to borrow money. He had said in the past that he would not borrow from anyone, but he was forced to.”
Tarin said that IMF’s loan is not only about $1 billion. It is a “stamp of approval.” “When the IMF gives a loan to a country, other financial institutes like the Asian Development Bank and World Bank also lend money.” Tarin said that Pakistan’s inflation is due to four to five imported items which include oil, coal, edible oil and steel. If inflation caused by these imports is subtracted, domestic inflation would be even lower than it has been in the past few years.
“In three to four months, the prices of coal, petrol, steel and edible oil will fall, and subsequently, inflation will go down. With low inflation, the exchange rate will stabilise. This is called trade equalisation.” Tarin clarified that his vote is registered only in Mardan and that it was never registered in Karachi. When asked why he was contesting the elections from KP, he said his in-laws lived there.
“I requested my party to let me contest the election from KP and they supported me,” he added. Earlier this month, Pakistan Tehreek-e-Insaf issued a Senate ticket to Tarin from KP. The seat was vacated by Ayub Afridi who resigned in November. Later, Afridi was appointed PM’s adviser on overseas Pakistanis and human resource development.