by SHAHBAZ RANA
UK FCDO chief economist says Pakistan should opt for foreign investment only in export-related sectors
A “normal” country does not need an International Monetary Fund programme but Pakistan’s next few years seem difficult without its support, according to Foreign, Commonwealth and Development Office (FCDO) of the UK Chief Economist Professor Adnan Khan.
In an interview with The Express Tribune, Khan also maintained that Pakistan’s tax system was unjust as the poorest 10% of citizens were paying a larger share of their income in taxes than the richest 10%.
He further suggested that Pakistan should opt for foreign investment only in the export-related sectors. He added that no new investment should be channelled into the power sector.
However, he continued that foreign investment would not come to the country as long as the local investors remained sitting on the fence. “They [local investors] will have to start investing.”
Khan visited Pakistan and held meetings with Prime Minister Shehbaz Sharif, Finance Minister Muhammad Aurangzeb and the business community to better understand the country’s economic trajectory.
He spoke at length with The Express Tribune about Pakistan’s economic ailment and where it went wrong in its history.
“A normal country should not need the IMF,” Khan said while responding to a question.
He, however, observed that Pakistan’s next few years looked difficult without an IMF programme, partly because of a huge fiscal gap and the balance of payments crisis.
Pakistan inking 23 bailout packages with the IMF and preparing for the 24th one does substantiate Khan’s comments about a country that is not acting normally.
Express Tribune for more