Staff Reporter
Islamabad
Countries around the world have initiated various measures to mitigate the effects of the Covid-19 pandemic, and nothing could stop them from printing more money for the purpose. Pakistan should also print more money and distribute it through nationwide relief programs, such as ‘Ehsaas’, to boost spending and jumpstarting the economy, an eminent economist and former federal secretary finance has advised.
The views were shared at a webinar titled ‘Pakistan’s Economic Outlook and Way Forward’, which was organized by Institute of Policy Studies (IPS) as part of its webinar series ‘Covid-19: Global Challenges, National Response’, by Dr. Waqar Masood Khan, former secretary finance and member of IPS National Academic Council.
It was chaired by Executive President IPS Khalid Rahman while the participants included Syed Muhammad Ali, senior research fellow IPS, Mirza Hamid Hasan, former federal secretary water and power, Air Commodore (r) Khalid Iqbal, and Zaheeruddin Dar, executive consultant and external expert, Center for the Promotion of Imports from Developing Countries.
Dr. Masood said the economy needs cash infusion instead of austerity and this can be done by increasing money supply in the system. In this regard he suggested raising the amount being paid under the Ehsaas Emergency Cash program from Rs12,000 to Rs60,000 split into two tranches.
He said the savings from less dollar payments due to declining global oil prices will compensate for the reduction in remittances by overseas Pakistanis and drop in export earnings. These will help spur the economy while the country’s vital dollar reserves will not decline. The government needs to think at the macro level, he added. He was of the view that using inflation targeting and interest rates for growth is impractical economics. Regarding the upcoming budget, he said: “It will be a budget put together in a state of war.
