New Delhi, Jan 12 Facing a severe economic crunch in the absence of political will, net losses of state-owned enterprises (SOEs) in Pakistan surged by 300 per cent, while taxpayer-funded fiscal support surged to Rs 2.1 trillion (local currency), according to a new report.
The Tribune Express writes in an Editorial that the “headline numbers are troubling”.
“Aggregate SOE revenues fell by Rs 1.4 trillion to Rs 12.4 trillion in FY25, while overall net losses widened sharply to Rs 122.9 billion from Rs 30.6 billion in the same year,” the Editorial further stresses, adding that few indicators capture the depth of Pakistan's fiscal malaise as starkly as the performance of its state-owned enterprises.
The report clearly states that “this is a horrific structural failure that continues to drain public resources and undermine economic stability”.
The National Highway Authority and power distribution companies continue to bleed, “weighed down by structural flaws and operational inefficiencies that have been discussed ad nauseam but rarely addressed with resolve”, it added.
Meanwhile, the government in Pakistan is actively feeding 'paper growth' sectors that may bring some GDP growth but do not stimulate commercial investment -- like real estate where the rich park their wealth and let it grow. Since 2019, the poorest 20 per cent of Pakistani households have seen their real monthly incomes plunge by nearly 12 per cent, said the Editorial in The Express Tribune.
“In contrast, the wealthiest quintile enjoyed a 7 per cent increase, which may not seem high till we consider that they were making all that money when the economy was in freefall, average wages outside the public sector were declining, and poverty shot up,” the Editorial mentioned.
The fact is that savings have been nearly wiped out for most, collapsing by 66 per cent overall, as families deplete their reserves just to afford essentials. “Consequently, spending on health and education has fallen by a staggering 19 per cent, which does not bode well for the future,” the report lamented.
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