Extraordinary steps are certainly needed to overcome the most serious crisis in the history of the national economy of Pakistan
Extraordinary steps are certainly needed to overcome the most serious crisis in the history of the national economy. Banning the import of unnecessary and luxurious items without which there is no major difference in life and the bu
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siness of life can be continued without any major difficulty, is of fundamental importance in these counts. It is very clear how result of economy will improve.
A reduction in the import bill means a reduction in the country's expenditure, which in turn improves the balance of payments and saves foreign exchange. That is why prominent economists have been advising the previous government to do the same in the last few years to overcome the growing economic woes, but it has not been acted upon.
However, the new government decided to take this step and yesterday Prime Minister Shahbaz Sharif immediately imposed a complete ban on the import of more than 80 luxury items. The decision to impose a complete ban on imports of unnecessary and luxurious items has been taken to deal with the foreign exchange crisis in the country. It has been reported that the Prime Minister, while approving the FBR's proposals to reduce the import bill by 1 billion per month, doubled the regulatory duty on vehicles over 1000 cc, importing more than 80 products including cosmetics, mobile phones, dog and cat food.
It has decided to increase the ban on electricity, increase the regulatory duty on home appliances by 50 per cent and import of tiles by 40 per cent. However, final approval of all these measures will be sought from the Economic Co-ordination Committee and the Federal Cabinet. The Prime Minister's expectation that these measures would save one billion a month in foreign exchange and reduce the devaluation of the rupee seems reasonable. According to details, a worrying economic situation was reviewed in a high-level meeting chaired by Prime Minister Shahbaz Sharif on Wednesday.
The participants agreed to take tough decisions to tackle the economic crisis and decided to impose a complete ban on the import of non-essential and luxury items without delay in order to overcome the foreign exchange reserves crisis in the country. The Prime Minister said that import of unnecessary and luxury items would not be allowed to cost valuable foreign exchange. According to sources, the ban on import of non-essential items will not further devalue the rupee. Undoubtedly, the continuous depreciation of the Pakistani coin is a sim killer for the national economy. Due to lack of effective measures to stop this trend, the dollar which was around Rs. 188 a month ago crossed Rs. 200 yesterday. T
his situation has led to a sharp decline in foreign exchange reserves and a sharp rise in inflation. Only a month and a half of foreign exchange remains in the national treasury. However, it is hoped that after a complete ban on non-essential imports, the savings of one billion dollars per month will immediately help in raising the value of the rupee and improving the foreign exchange situation, while negotiations with the IMF have also begun.
And the finance minister has expressed good prospects for its success, after which the cooperation of friendly countries is also expected. Foreign Minister Bilawal Bhutto's visit to the United States is also looking promising. US officials have given clear indications of support for economic recovery.
Therefore, it is not unreasonable to expect that if the climate of political uncertainty in the country is eliminated and the present government has the opportunity to operate in a fear-free environment till the completion of its constitutional term, the situation can be rapidly improved.
