PIDE Chief For Attracting Foreign Investment Instead Of Getting Loans To Improve Economy

PIDE Vice Chancellor and PSDE President Dr Nadeem Ul Haque has stressed the need for giving due attention to attracting foreign investment instead of getting loans to achieving sustainable growth of the national economy

ISLAMABAD, (UrduPoint / Pakistan Point News - 21st Nov, 2023) PIDE Vice Chancellor and PSDE President Dr Nadeem Ul Haque has stressed the need for giving due attention to attracting foreign investment instead of getting loans to achieving sustainable growth of the national economy.

He said the economic system in Pakistan was on a ‘life support system", and emphasized on exploring measures to tackle confronted challenges like the surge in the exchange rate of the rupee with other currencies, unemployment, and the aid-debt trap.

He was addressing the inaugural session of a 3-day Annual General Meeting (AGM) and conference the Pakistan Society of Development Economists (PSDE), hosted by the Pakistan Institute of Development Economics (PIDE) in collaboration with Bahaduddin Zakariya University (BZU), held at the BZU’s Jinnah Auditorium of the University in Multan, a news release said here on Tuesday.

He also highlighted PIDE & PSDE’s role in asking pertinent questions and engaging in impactful research exploring the country’s wide-ranging socio-economic issues, stressing the need for a paradigm shift in thinking and the importance of asking critical questions.

“. . . . the focus should be shifted to investment and finding ways to increase it. Regarding the economic and development plans in Pakistan, he pointed out the irony of having too many plans yet too little development,” he added.

Dr Nadeem further pointed out that the solution to the economic quagmire was not getting more debt, criticizing the overreliance on loans, particularly from institutions like the International Monetary Fund, adding Pakistan was in the perpetual cycle of aid-debt traps involving IMF, donors, consultants, and Transparency International.

Dr Nadeem also questioned the effectiveness of raising taxes and the lack of challenges to consultants in the development process.

He highlighted the significant contributions of renowned economic late Mahbub ul Haq to PIDE, a news release said here on Tuesday.

He also highlighted PIDE & PSDE’s role in asking pertinent questions and engaging in impactful research exploring the country’s wide-ranging socio-economic issues, stressing the need for a paradigm shift in thinking and the importance of asking critical questions.

PSDE Secretary Dr Iftikhar Ahmad reiterated the PIDE’s desire to initiate and collaborate on further research with researchers in South Punjab.

He said that in this year’s conference, two-panel discussions were focused on South Punjab, featuring panellists from academia and regional centers.

The first-panel discussion of the conference was on “Foreign Aid: Boon or Bane?,” moderated by Shahid Mahmood, Research Fellow at PIDE, Asad Hayauddin, Former Secretary of the Economic Affairs Division, Tobias Haque, Lead Country Economist for Pakistan at the World Bank, and Naveed Aziz, Senior Governance Advisor to the FCDO.

The moderator said that since 1950, Pakistan received over USD 200 billion in foreign aid, out of which. a significant chunk has been in the form of loans, and a large amount of aid has been “tied aid.”

He said the donor agencies influence major policy decisions; however, there was a dearth of cost-benefit analysis of the projects.

Asad Hayauddin said it was unfortunate that foreign donor agencies had been helping set Pakistan’s development direction.

He said two neighbouring countries of Pakistan have also turned to the IMF, but they remained stuck to the plan to reverse the crises. Contrary to them, he regretted that “Pakistan, on the other hand, deviates from the agreed-upon path after gaining some sense of stability following support from the IMF and other donor agencies.”

Tobias Haque said that there were numerous examples where countries went to the donors with a homegrown development plan and sought development agencies’ financial and technical assistance.

Likewise, he said Pakistan needed to develop a crisp indigenous development plan and then seek donors’ assistance. “In such a case, the donors would have very little wiggle room to deny assistance on Pakistan’s terms.”

Naveed Aziz said aid utilization had not necessarily been entirely negative in Pakistan, and aid dependence in some areas had come down as well.

All panelists agreed that Pakistan needs to develop a long-term development plan with a clear indication of what support it requires from external sources and to what extent. Pakistan’s debt utilization stands as a major issue that has to be immediately improved. Pakistan needs to realize that aid is not the solution to problems, instead, it is just a tool to facilitate the implementation of development plans and achieving the set goals.

The co-hosts of PSDE’s 37th Annual Conference, organized by PIDE, include the World Bank Group, UNICEF, RASTA, the Bank of Punjab, Pakistan Poverty Alleviation Fund, Saudi Pak Agricultural and Industrial Investment Company, and BZU School of Economics.