General Secretary PML-N Sindh and Former Federal Minister of Finance, Miftah Ismail posted a video online criticizing the PTI government for lying to the public regarding the ongoing debt crisis, saying, “PTI hasn’t returned even one paisa of the debt owed”.
پی ٹی آئی نے ایک پیسہ بھی قرض واپس نہیں کیا بلکہ پاکستان کو 12 ہزار 500 ارب روپے سے مزید مقروض کردیاہے ۔اس ویڈیو میں میں نے یہ بات بتائی ہے کہ وہ صرف قرض بڑھا رہے ہیں ۔ pic.twitter.com/TZXridc2QC— Miftah Ismail (@MiftahIsmail) February 17, 2021
He started by saying that when PML-N came to power, the total debt (External and Domestic) owed by the country was Rs. 14,000 billion and, in the 5 years of their governance it had increased to almost Rs. 25,000 billion by 2018. He said that this money was used to build power plants and other important projects. On the other hand, he said that the current government has spent nothing on infrastructure or development, but increased debt by huge proportions.
He said that PTI has, in two years duration has increased the debt from Rs25,000 billion to Rs36,000 billion, while the tax revenue has not increased at all. This can lead to disaster.
He added that during the PML-N regime, external debt and liabilities were Rs. 11,575 billion while under the PTI regime, they have reached Rs18,969 billion in just two years, showing a loss of Rs. 7,500 billion. He said that even if we compare the loans borrowed, during the PMLN’s time, the loan was around $70 billion, which has now risen under the PTI to $80 billion.
He commented that any metric would show us that PTI has been a failure to date. Even if we see the amount of borrowing the country has done since 1947, we will find that 30% of the total loan has been taken during Imran Khan’s time, while the rest 70% took over 71 years of accumulation.
“The debt was 65 percent of GDP when PML-N came to power and 72 percent on completion of its tenure. But during the PTI tenure, the debt-to-GDP ratio has risen to an astonishing 87 percent, with the debt increasing by 15 percent in just two years,” Mr. Ismail said. Adding to it he said that the percentage increase in the debt-to-GDP ratio has come from 1.2% to around 7.5%.
Has Government Actually Paid Back Loans?
Ex-Finance Minister disagrees. “Not even a single paisa” he claims in the video. He claims that PTI is been reloading debt. Debt reloading is when the government pays back one country’s debt by borrowing from another. He gives the example of how Pakistan returned Saudi Arabia’s 1 Billion Dollar by borrowing $1 billion from China. So, in essence, according to Mr. Ismail, Pakistan’s external debt has not decreased.
He also gave the example of T-bills otherwise known as Treasury Bills, usually used as short-term negotiable debt instruments, for domestic debt. He said that when people went to collect the promised amount after the end of the maturity period, the government just gave them a new date rather than the money owed, thus even domestic debt not decreased.
He commented on this saying that if PTI government had actually paid back debts like it claims, the debt would have gone down from Rs. 25,000 billion, rather than climbing up to Rs. 36,000 billion.
He humorously, gave the example to compare the complaints of the PTI to saying it’s like his father leaving him a factory with some liabilities. However, he said that if he and his brother had started complaining about the liabilities rather than being grateful for the factory, an asset, they would be foolish.
Yes, he said, PML-N government left Pakistan with debt but did viable projects in the form of motorways and other development projects. Thus, PTI’s outcry is ridiculous. Expanding on it he said that when PMLN came to power, the tax capacity was so low that only Rs1,900 billion was being collected in taxes but it was increased to Rs3,850 billion under their regime.
Economic Survey 2018-19 released by PTI gov acknowledges unprecedented 2362 kms motorways initiated/completed in the country by #PMLN Nawaz Sharif Govts to give Pakistan the most modern logistics infrastructure in South Asia. pic.twitter.com/wwoyfOPfUV— Ahsan Iqbal (@betterpakistan) July 12, 2019
He hoped that the government improves taxation ability along with the increased debt that the government is incurring so that national income increases.