Photo: fileThe macroeconomic instability that plagues Pakistan today dates back to 1989 –the year which marked the end of Afghanistan’s invasion and consequently, the stoppage/ slowdown of US aid through the Pressler Amendment. This growth, however, was accompanied by a relatively high inflation, low employment, low current account and budgetary deficits. The next stint of political and economic stability started after the APS attack in 2014 and ended in 2017 with the Panama Paper case. The partial indexation of pays, pensions and current expenses can hardly make any impact on economic growth, apart from appeasing the inflation-hit government employees. This type of budget might be the second-best arrangement in the current macroeconomic scenario and political instability, but it is not an optimum way to approach and tackle the problem.

Source: The Express Tribune June 19, 2023 09:33 UTC