Pakistan's economy demands immediate governance reform to ensure sustainability

Pakistan's current economic governance model is heavily reliant on consumption-driven, import-led, and debt-driven growth mechanisms, which are inherently unsustainable. The government has launched two ambitious economic plans, 'Uraan Pakistan' and the 'National Economic Transformation Plan,' aimed at reshaping the financial future of the country. However, the prevailing governance structure is ill-equipped to implement such bold economic changes. The focus has primarily been on fiscal policy, often disregarding the importance of monetary policy and broader economic governance. This narrow approach has resulted in systemic issues, including recurring macroeconomic crises, significant trade deficits, balance of payments challenges, and escalating public debt over the past 70 years. As a result, Pakistan's economy has witnessed excessive fiscal dominance, undermining its potential for sustainable growth and investment. To address these challenges, a coherent economic policy must be developed that effectively integrates fiscal, monetary, and exchange rate policies. The emphasis should not merely be on revenue collection but rather on establishing a balanced framework that promotes productive economic governance. This is essential to ensure that external imbalances can be managed in a manner that fosters economic resilience and growth. Additionally, there is a need for a fundamental reorganization of institutional structures to elevate the role of monetary policies alongside fiscal policies. The true measure of economic governance should prioritize efficiency in resource allocation and standardization of economic statistics across provinces. Ultimately, the success of Pakistan’s economic plans hinges on a comprehensive governance overhaul that aligns fiscal and monetary objectives for a more sustainable economic future.