PBIF chief for ending practice of causing harm to economy to gain political advantages

KARACHI: Chairman of National Business Group Pakistan, President Pakistan Businessmen and Intellectuals Forum, Mian Zahid Hussain called to end the practice of causing harm to the economy to gain political advantages.

He said that a short-term benefit is unacceptable, resulting in a long-term loss as the whole nation has to pay the price for such decisions.

Mian Zahid Hussain said that political choices at the expense of the economy have pushed the country to the brink; therefore, such practices should be stopped.

He said that economic decisions aimed at gaining popularity have shaken the country’s foundations. Decisions related to the economy should be made above political considerations; otherwise, the country would remain in trouble.

He said that our rulers are not in the habit of controlling expenditures but start lavish expenditures for political interests. They have to borrow and print excessive currency due to a deficit, which results in currency depreciation and inflation.

Mian Zahid Hussain informed that the money supply in the country increased by 100% in the five and a half years since FY 2018, which witnessed a sharp acceleration from January to June last year, which also boosted inflation.

Now that the process of printing currency has slowed down, inflation is also decreasing slowly. If the prices of electricity, oil, and gas were not increased, the process of reducing inflation would have been accelerated.

He said that private-sector borrowing cannot be blamed for excess money in the market, as government borrowing has more to do with it.

In these circumstances, the central bank is left with the option of increasing the interest rate, which is being implemented.

Mian Zahid Hussain further said that if production also increased along with the increase in money supply, inflation would not have occurred, but if production remained stagnant, inflation would increase.

Copyright Business Recorder, 2024