5 Reasons of Pakistan Economic Crisis: Explained
Pakistan's debt-to-GDP ratio is currently dangerously high. The World Bank estimates that Pakistan's total external debt stocks will rise from $115.695 at the end of 2020 to $130.433 billion by the end of 2021. According to CEIC figures, the nation's external debt reached $126.9 billion in September 2022.
Pakistan's foreign exchange reserves fell to $4.3 billion in January 2023, its lowest level since 2014, according to an Aljazeera report.
Pakistan is struggling with poor economic development as well as soaring inflation that could reach 23% in FY23. Slower growth and growing inflation is proving to be a deadly mix for the nation.
Although Pakistan has ample installed power capacity, it lacks the funds to operate its oil and gas-powered facilities since they are insolvent and unable to pay for infrastructure and power lines. IANS said that the issue compelled the government to mandate that marketplaces and retail centres close by 8.30 pm in order to conserve energy.