A report by Bloomberg regarding Pakistan’s debt figures is so alarming that it sent shudders running down my spine.
As per this report bets are rising that Pakistan will default on its debt just as it starts to revive investors’ interest with a reduction in terrorist attacks. About 42 percent of Pakistan’s outstanding debt is due to mature in 2016— roughly $50 billion–equivalent to the size of Slovenian economy. The bulk of this debt however is in local currency. Meaning thereby that there is no reason to panic as only $ 4 billion of external debt is due for payment in 2016. But in the long run, the policy of building our economy on loans from internal as well as external sources will put the country at a huge risk of default, because of our failure to check continuous slide downwards in exports. The cycle of borrowing more money to retire previous debts can land us in a position that will be worse than even that of Greece.
Pakistan unfortunately once again has been given into the clutches of the notorious IMF which has an uneviable reputation of destroying the economies of the nations it apparently patronises.
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