Islamabad,(Daily Parliament Times):
The Federation of Pakistan Chambers of Commerce and Industry’s Businessmen Panel (BMP) has expressed grave concern over the alarming rise in public debt, warning that the country is drifting deeper into a debt trap that threatens economic stability, business confidence, and long-term growth. Former FPCCI President and Chairman of the Businessmen Panel, Mian Anjum Nisar, said the latest figures showing public debt breaching the statutory limit by nearly Rs17 trillion should serve as a wake-up call for policymakers, stressing that cosmetic adjustments and short-term fixes can no longer address Pakistan’s structural economic weaknesses.
Mian Anjum Nisar criticised the continued violation of the Fiscal Responsibility and Debt Limitation Act, noting that a debt-to-GDP ratio of over 70 percent is not only unsustainable but also undermines the credibility of fiscal management. He said that when public debt consumes nearly half of the annual budget in the form of debt servicing, the government is left with little room to invest in development, infrastructure, education, or health. This, he added, creates a vicious cycle where low growth leads to higher borrowing, which in turn further suppresses growth.
He pointed out that repeated assurances of fiscal consolidation have failed to materialise into tangible outcomes. Despite claims of improved debt management through maturity lengthening, the overall debt stock continues to rise sharply, reflecting the government’s inability to control deficits or generate sufficient revenue through genuine economic expansion. According to Nisar, extending loan tenors may reduce short-term refinancing risks, but it does not solve the fundamental problem of excessive borrowing driven by weak growth and poor revenue mobilisation.
The BMP chairman was particularly critical of the Federal Board of Revenue’s performance, saying persistent failure to meet tax targets highlights deep flaws in the existing tax system. He said the burden of taxation continues to fall disproportionately on documented businesses and salaried classes, while large segments of the economy remain outside the tax net. Slowing refunds, reliance on advance taxes, and one-off gains from court judgments cannot substitute for a broad-based, fair, and efficient tax regime.
Nisar warned that weak revenue growth, combined with rising expenditures and high debt servicing costs, is pushing Pakistan toward a prolonged period of economic stagnation. He said the business community is already under immense pressure due to high energy prices, elevated interest rates, and regulatory uncertainty, all of which discourage investment and expansion. Without decisive reforms, he cautioned, Pakistan risks losing whatever competitiveness it still has in regional and global markets.
Offering a way forward, Mian Anjum Nisar stressed that Pakistan must urgently shift its economic strategy toward high, sustainable, and export-led growth. He said debt reduction is not possible through austerity alone and can only be achieved by expanding the economic base. This requires a consistent focus on boosting exports, encouraging industrialisation, and supporting small and medium enterprises, which are the largest source of employment and innovation.
He urged the government to rationalise energy tariffs across the board, arguing that high and unpredictable energy costs have crippled manufacturing and exports. Competitive energy pricing, he said, is essential if Pakistan wants to attract investment and retain existing industries. He also called for a significant reduction in the policy rate to stimulate private-sector credit, noting that prolonged high interest rates suppress investment and slow economic activity, ultimately worsening fiscal outcomes.
On taxation, Nisar emphasised the need for comprehensive reform aimed at widening the tax base rather than increasing rates on existing taxpayers. He suggested bringing wholesale, retail, real estate, and agriculture sectors into the documented economy through simplified procedures and incentives, instead of relying on coercive measures. A predictable and transparent tax system, he said, would improve compliance and help generate sustainable revenue growth.
The BMP chairman also highlighted the importance of governance and institutional reforms. He said leakages, inefficiencies, and losses in state-owned enterprises continue to drain public resources and add to the debt burden. Privatisation or professional restructuring of loss-making entities, he argued, is essential to reduce fiscal pressure and improve service delivery. He added that borrowing to finance inefficiency is one of the main reasons Pakistan’s debt has spiralled out of control.
Nisar further stressed the need to promote investment-friendly policies to attract both domestic and foreign investors. Political stability, policy continuity, and swift dispute resolution mechanisms, he said, are critical for restoring investor confidence. He also called for a long-term industrial policy focused on value addition, technology adoption, and skills development to enhance productivity and competitiveness.
Mian Anjum Nisar said Pakistan still has the potential to pull itself out of the current crisis, but only if hard decisions are taken without delay. He warned that continued reliance on borrowing, without addressing structural weaknesses, will only deepen the crisis. The BMP, he said, stands ready to work with the government on a national economic revival plan, but stressed that meaningful reform, not rhetoric, is the only path toward debt sustainability, high growth, and economic resilience.