'Pakistan is bankrupt, sinking deeper': Top economist says establishment is 'clueless', attempt being made for a compromised group

Pakistani-American economist Atif Mian on Monday blasted the Pakistani authorities for the political uncertainties which he believes will worsen the economic situation of the country. He said there was an attempt, once again, to cobble together a compromised group, but no one had a plan to fix the economy. "But even if they magically did, somehow, they cannot do anything because they have lost all trust in their people. They are foreigners in their own land," Mian said. 

Also read: Pakistan elections 2024: Nawaz Sharif, Bilawal Bhutto alliance likely; Imran Khan’s PTI challenges poll result

The general election in Pakistan threw a fractured mandate, with Imran Khan's Pakistan Tehreek-e-Insaf emerging as the single largest party. However, Nawaz Sharif's Pakistan Muslim League (Nawaz) and Bilawal Bhutto's Pakistan Peoples Party (PPP) have begun talks to put up a coalition government. 

Mian, who currently teaches finance at Princeton University, said Pakistan's economy has consistently fallen behind globally – last year was one of the worse, with the economy contracting. He said every macro fundamental was flashing red: inflation, growth, debt, investment, to name a few.  

The top economist, who was once part of Imran Khan's advisory council but was forced to quit, said the federal government had no money and could not even afford to pay the salary of a peon or a soldier without borrowing. The entire tax revenue, he said, was consumed after paying provinces their share, pensions to retirees, and interest on debt. 

"Inflation cannot be controlled when the entire government is run on deficit. Growth is impossible when the government has no money to invest in the future. And lack of growth makes every problem worse," he said. "The country is bankrupt. It is sinking deeper every year."

Mian said that he had never seen such despondency. "So many wanting to leave, established firms no longer comfortable investing. Yet no leader has a viable economic plan for the future. The shady establishment that calls shots from behind is especially clueless," he said in an apparent reference to the Pakistan Army, which some believe trying to put a coalition government that can be managed.   

Blasting the political leadership, the economist said that they were expecting foreigners to believe in the country when their people were losing all hope. He said people were mad – and they had every right to be. 

"442,353 children died in Pakistan just last year due to poverty. That is almost half a million dead kids EVERY YEAR. But the establishment was busy playing its usual games – put this one in jail, and that one in parliament this time – keep the system just unstable enough so we stay relevant, our children be damned," he said. 

The professor said that the establishment sensed the people's anger, so every action to rig the elections was taken – except it only made the public madder. "So here we are post Feb 8 – the distance between the ruler and the ruled has never been wider. Do they understand how dangerous that is?" 

Syed Shabbar Zaidi, former chairman of the Federal Board of Revenue, said what Atif Mian was saying now was correct. "I had been saying the same since 2021. This country is on a downward stream. Elections 2024 have added the worries. NS, AZ & MQM do not understand the ground realities. They will regret. Mark me. But we will not let it fail."