Pakistan is ‘bankrupt’, says former chairman of apex tax authority

Karachi: The former chairman of Pakistan’s Federal Board of Revenue Shabbar Zaidi has said that the country is ”bankrupt” and it is better to recognize the reality than ”living in illusion”.

Zaidi — who was chairman of the apex tax authority from May 10, 2019, to January 6, 2020 — also called for transparency in the China-Pakistan Economic Corridor (CPEC) project, saying he himself had not yet fully understood what it was.

Addressing a seminar at Hamdard University here on Wednesday, he said everyone in governance kept on saying that everything is good and the country is running well.

“They say we have achieved great success and we brought tabdeeli (change), but this is wrong. In my view, the country is, at the moment, bankrupt and not a going concern,” Zaidi said.

Going concern is an accounting terminology referring to a business that is operating and making a profit.

”It is better if you decide first that we have reached bankruptcy and we have to move forward compared to saying everything is running well and I will do this and that. These are all things to deceive the people,” Zaidi said.

Zaidi also called for transparency in the USD 60 billion CPEC project, saying that he himself had not yet fully understood what it was. He lamented about confusion over which projects were part of CPEC.

The CPEC is a planned network of roads, railways, and energy projects linking China’s resource-rich Xinjiang Uyghur Autonomous Region with Pakistan’s strategic Gwadar Port on the Arabian Sea. India has objected to the CPEC as it is being laid through Pakistan-occupied Kashmir.

A video clip of Zaidi’s speech was shared widely on social media. As soon as the video went viral, Zaidi on Thursday claimed that his speech was being ”misreported” and only a three-minute portion of it was “cherry-picked”.

”Yes I said that with this constant current account & fiscal deficit there are issues of bankruptcy & going concern but look at the solution,” he tweeted.

Zaidi said his statement had been made on a ”basis & conviction”. ”I only want to say that (the) whole speech is to (be) read and listened (to).” In another tweet later on Thursday, the former FBR head said Pakistan’s total foreign debt stood at over USD 115 billion, while its current account deficit was between USD 5 billion to USD 8 billion.

”When will we be able to pay that debt? It is better to recognise the reality than living in illusion. We need to have a reality check,” he said.