Public Debt – in simple words total of Domestic and External/Foreign debt. Almost every country in the world borrows money [Domestically & External] regardless of whether the country is rich or not.
Is borrowing wrong?
There’s nothing necessarily wrong with borrowing as long as it is to be use for development purposes and one is able to pay the money back on-time as agreed.
Taking loan is like; using future money now. For example, you buy plot/house/machinery now on loan, it may take you 5-10 years to repay the loan amount. But what after 5-10 years? In future rate you paid very less compared to new rate/growth/market-value. You went through some difficult times but it saved you a-lot of money & you reaped the financial benefits.
Debts, which are used for development purposes [rails/roads/health/education/ energy & security] which increases the productivity of economy, increases revenue, raises socio-economic status & increases GDP is a good debt. It’s all about using it wisely.
Many of us have the misconception that only poor countries borrow money and considers borrowing countries as failed states. Let’s have a look at countries and their share in total debt.
US, Japan, China, Germany, Italy, France, UK, Canada, Brazil & India alone shares 80.2% of the total world debt. Do we consider these countries as economically failed states? In comparison to other countries of the world Pakistan’s share is only 0.5% of the total world debt.
I’m confused that either people really don’t know the facts or they simply misquote/spread misinformation just because they oppose that government. Let’s have a look at where we were, where we are today, which government did what & who’s to be blamed.
An increase of 16906 Billion Pakistani Rupee since 1971, share of governments:
1971 – 1977: Z A Bhutto, PKR 30 bln. To PKR 97 bln.
1977 – 1988: Zia ul Haq, PKR 97 bln. To PKR 523 bln.
1988 – 1990: Benazir Bhutto, PKR 523 bln. To PKR 711 bln.
1990 – 1993: Nawaz Sharif, PKR 711 bln. To PKR 1135 bln.
1993 – 1996: Benazir Bhutto, PKR 1135 bln. To PKR 1995 bln.
1997 – 1999: Nawaz Sharif, PKR 1995 bln. To PKR 2946 bln.
1999 – 2008: Musharraf, PKR 2946 bln. To PKR 6126 bln.
2008 – 2013: Asif A Zardari, PKR 6126 bln. To PKR 14293 bln.
2013 – 2015: Nawaz Sharif, PKR 14293 bln. To PKR 16936 bln.
Pakistan is IMF’s member since July, 1950 and Pakistan started borrowing from IMF in General Ayub Khan’s regime so it’s not Asif A. Zardari or Nawaz Sharif who pushed Pakistan into this [as many of you call it] “Trap”.
The myth “Musharraf reduced Pakistan’s debt” must die, instead of debt forgiveness/relief against assisting US in war on terror [read: attacking Afghanistan]. Musharraf rescheduled the loan repayment to 15 years so that the future governments pay the due amount & a sharp increase in Public debt was seen in his regime [shown above].
Debt in Pakistan is rescheduled many times since early 70’s, it provides temporary relief to country to revive its economy but a burden for future governments if the necessary steps [revival of economy] aren’t taken, but; instead of reviving the economy funds were used for subsidies for political mileage.
***KNOW THE FACTS, MAKE A FAIR JUDGMENT***