General

Growth rates achieved during military regimes were artificial: Ahsan Iqbal

Minister for Interior Ahsan Iqbal has said that higher growth rates Pakistan achieved during military regimes were artificial and led through the inflow of dollars.
“People often say the growth rate during military regimes was higher than the one in democratic regimes,” Iqbal said, while addressing the business community at the Lahore Chamber of Commerce and Industries.
“Don’t compare apples with oranges; whenever the country achieves 6% growth rate during a military regime, it is due to certain events,” he added.“Take the example of Musharraf’s regime where initially, the growth rate was stagnant at 2.5% for the first three years. After 9/11, Pakistan observed the inflow of liquidity in the shape of dollars as we partnered in the war on terror, which resulted in 6% growth for some years,” Iqbal explained.
According to the minister, even at that time, economic managers failed to ensure any productive investments and create consumer-based economy. This, he added, ultimately resulted in higher imports and a widening trade deficit. When the inflow of dollars dried up, the economy collapsed.
Iqbal went on to add that it is the first time in Pakistan’s history that a political government has managed to achieve economic stability by not getting involved in geo-politics, but in geo-economics. “We targeted four areas including energy, extremism, economy and education and achieved considerable results”, he maintained.The minister said now is the time for the masses to decide whether they need continuity or disruption in economic stability that has been achieved despite political hiccups.
“We successfully achieved economic stability in a country while in 2013, no local or foreign investor was ready to invest in any mega project in Pakistan.
“Now, we are set for economic growth. If we reach 6% growth this year then it could be an indicator that in the next two to three years, we can achieve 8% growth rate, mandatory to generating 2,000,000 jobs per annum.”
Iqbal termed 21st century as the century of economics and economic blocks like G7, G20 and G77. “Your passport to these economic groups is your GDP and your economy; this is the century of ideology and we have to be an economic nation and for this we have to create a perfect harmony between peace, stability and development”, he remarked.
He observed that the upcoming challenge for Pakistan is to be able to integrate with the global economy as previously, the country failed to capitalise on the changing trends.
Iqbal regretted that country’s economic policy was previously based on import substitution, saying the governments never put on any export-led strategy like China, Malaysia, Japan etc, which see exports as their growth engine.
The minister termed foreign direct investments and better exports as the key for earning foreign exchange. He added that ideally, Pakistan needs $20-$25 billion annual FDI to harvest its exports.
The current FDI inflows are not enough and need to be enhanced further, he said, adding that due to the China-Pakistan Economic Corridor, Pakistan is fast becoming a magnet for almost all developed nations.
He also said that economic opportunities for local and foreign investors in CPEC are equal and no preference has been given to foreign investors over local investors.