Debt, Austerity and Taxes (English)

November 12, 2016

Every few days we have a conference on debt, taxes or stabilization.  Pakistan seems to be obsessed with stabilization and collecting more taxes even if it means killing growth.  And we have killed our growth and productivity potential through this discourse.

Sadly, this analysis has been inspired by donor funding which has diverted all of Pakistan intellect to thinking only revenues and poor quality fiscal adjustment a clear path to low growth and productivity. This is what is called austerity in the West. 

Research and debate in Pakistan is funded in this direction.  Very little research is done on growth and reform. Nor are there any conferences on that subject.  Pakistani intellect is incapable of challenging the austerity narrative of donors.

Here I argue for growth and against austerity and hope more of you will review this topic and discuss it.

Pakistan needs to change its strategy from giving excessive weight to stabilization through excessive taxation and poor choices in fiscal correction. Giving priority to growth will lead to wiser choices.

It is time that we started looking at avenues for enhancing our growth through reform. That is the only way of achieving a sustainable and quality stabilization. 


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