Wasteful spending across all government departments, particularly in the loss-making public sector enterprises, should be eliminated: LCCI office-bearers
By Commerce Reporter
LAHORE – The Lahore Chamber of Commerce & Industry (LCCI) has raised serious concern over the Federal Government’s unprecedented borrowing which has surged to a staggering Rs. 70,366 billion as of November 2024. This includes Rs. 48,585 billion in domestic debt and Rs. 21,780 billion in external loans signaling a critical juncture for the nation’s fiscal health.
LCCI President Mian Abuzar Shad, Senior Vice President Engineer Khalid Usman and Vice President Shahid Nazir Chaudhry said in a statement that the high borrowing is equally troubling the debt-to-GDP ratio, currently at 66%, which surpassed globally acceptable limits.
They warned that this unsustainable debt trajectory poses serious risks to Pakistan’s financial stability, undermining its ability to manage repayment obligations, attract foreign investment and achieve sustainable economic growth.
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LCCI President Mian Abuzar Shad said that the growing repayment burden threatens the economy’s capacity to meet its financial commitments. He said that rising debt levels discourage both local and foreign investors from participating in Pakistan’s economic development. A significant portion of resources is diverted to debt servicing, leaving limited funds for infrastructure and social development projects.
The LCCI office-bearers urged the government to take immediate steps to address the debt crisis through strategic reforms and disciplined financial management. They said that public spending must be limited to available revenues to avoid fiscal deficits. Comprehensive tax reforms should be introduced to increase revenue without overburdening existing taxpayers.
Wasteful spending across all government departments, particularly in the loss-making public sector enterprises, should be eliminated. A business-friendly environment should be created to attract local and foreign investments, thereby reducing reliance on borrowing. They said that alternative and sustainable methods of revenue generation should be explored to lessen dependence on loans.
They said that tackling this pressing issue requires collective action from the government, private sector and civil society. Transparent and accountable debt management practices are critical to rebuilding economic confidence and ensuring long-term sustainability. They pledged to collaborate with the government and other stakeholders in devising practical solutions to strengthen Pakistan’s fiscal foundation.
They added that uncontrolled borrowing is a clear indicator of weak financial management and a lack of innovative strategies. The time to act is now. They urged the government to adopt measures that reduce the debt burden while promoting sustainable growth.
They said that the business community is deeply concerned about the economic repercussions of excessive borrowing. It is imperative to focus on sustainable growth strategies to steer the economy out of this crisis.
Mian Abuzar Shad, Engineer Khalid Usman and Shahid Nazir Chaudhry said that without immediate reforms, Pakistan’s financial future remains at significant risk. The government must act decisively to restore investor confidence and ensure fiscal discipline.
They said that through effective reforms and responsible governance, the nation can overcome the challenges posed by its escalating debt levels and chart a course toward a prosperous and self-reliant future.
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