Pak has no prospects of sustainable economic growth: US official

Washington: Pakistan faces no real prospects for sustainable economic growth, a top US intelligence official told lawmakers today, painting a grim picture of the country’s economy. “In Pakistan, the government has not instituted much-needed policy and tax reforms, and the country faces no real prospects for sustainable economic growth,” James Clapper, Director of National Intelligence, told members of the House Permanent Select Committee on Intelligence. [caption id=“attachment_696014” align=“alignleft” width=“380”]  Image for representation only. AFP[/caption] “On a more positive note, this past year the Armed Forces continued their operations in the Federally Administered Tribal Areas, or FATA, which have been safe havens for al-Qaeda and the Taliban, and Pakistan has scheduled national and provincial assembly elections for 11 May,” he said in his testimony before the Congressional committee. Referring to the elections, Clapper termed it as a milestone-the first time a civilian government has completed a five-year term and conducted a transfer to a new government through the electoral process. “Islamabad is intently focused on Afghanistan in anticipation of the ISAF drawdown. The Pakistani Government has attempted to improve relations with Kabul and ensure that its views are taken into consideration during the transition period,” he said. “The military this year continued operations in the Federally Administered Tribal Areas (FATA) and, as of late 2012, had forces in place for an operation against anti-Pakistan militants in the North Waziristan Agency of the FATA,” Clapper said. “There were fewer domestic attacks by the Tehrik-eTaliban Pakistan this year than in the previous several years,” Clapper said in his prepared remarks. “Economically, trouble looms. Pakistan, with its small tax base, poor system of tax collection, and reliance on foreign aid, faces no real prospects for sustainable economic growth. The government has been unwilling to address economic problems that continue to constrain economic growth,” the top intelligence official said. The government, he noted, has made no real effort to persuade its disparate coalition members to accept much-needed policy and tax reforms, because members are focused on retaining their seats in upcoming elections. “Sustained remittances from overseas Pakistanis (roughly USD 13 billion from July 2011 to June 2012, according to Pakistan’s central bank) have helped to slow the loss of reserves,” Clapper pointed out. “However, Pakistan has to repay the IMF USD 1.7 billion for the rest of this fiscal year for money borrowed as part of its 2008 bailout agreement, growth was around 3.5 per cent in 2012 and foreign direct investment and domestic investment have both declined substantially,” he said. PTI