PAKISTAN HOW TO LIVE WITHIN MEANS
By IJAZ NABI

Balance of payments crises and resort to IMF borrowing is a recurrent feature of Pakistan's economy. In the last three decades, there were few years when Pakistan was not in an IMF program. Fiscal mismanagement has played an oversized role in this, requiring prolonged periods of austerity and macroeconomic adjustment. A major objective of this book is to understand what drives the large and persistent fiscal deficits that lie at the heart of our economic malaise and how this may be addressed.Any charter for economic revival requires an agreement on prudent fiscal management among the main political parties and other power centers.and To that end, this book, reviews a vast body of empirical research and policy documents to focus on three aspects of Pakistan's fiscal deficits. Firstly, it examines the macro-economic consequences of the persistent fiscal deficits and assesses efforts to stabilize the economy under the IMF tutelage. Secondly, it examines the scope for: reducing public expenditure, reform of SOEs, alternatives to public provision of public goods, and achieving better expenditure outcomes. Thirdly, the book identifies the reasons Pakistan is unable to achieve its tax potential, and how the tax system can be reformed and its scope extended to individuals and activities that are either not in the tax net, grossly undertaxed or are able to evade their taxes, thereby levelling the playing field across individuals and economic activity. These critical aspects of economic management need to be addressed to align fiscal policy with the objectives of sustainable export led growth and meeting the challenges of global warming.