Islamabad, Sep 16 (PTI) Pakistan’s economy will be under increasing pressure during the ongoing fiscal and likely to face a current account deficit of USD 12 to 17 billion for 2021-22, a veteran bureaucrat and former aide to Prime Minister Imran Khan has said.

Addressing a book launch ceremony at the Institute of Business Administration (IBA) in Karachi on Wednesday, Dr Waqar Masood Khan said Pakistan's balance of payments crisis is likely to be severe, the Dawn newspaper reported.

“Pakistan’s economy will be under increasing pressure during the ongoing fiscal due to the looming crisis of balance of payments. The country was likely to face a current account deficit of USD 12 billion to USD 17 billion for 2021-22,” he was quoted as saying in the report.

Khan said the country should expect major changes in interest rate, exchange rate, taxation and energy policies as soon as the International Monetary Fund (IMF) programme is revived.

“Where will the exchange rate go if it’s left completely independent? What’s the point in building foreign exchange reserves if they are not stabilising the exchange rate?” he said, noting that the rate is at an all-time high of almost Rs 170 although the reserves have increased to USD 20 billion from USD 15 billion in May when the parity was around Rs 152. “I don’t get it. What kind of economics is it?” Khan stepped down recently as special assistant to the prime minister on revenue and finance.

He served as federal finance secretary from 2013 to 2017.

He called the external sector Pakistan’s main problem and blamed the recurring economic crises on the 1991 decision by the former prime minister Nawaz Sharif government to dismantle financial controls.

“Its disastrous impact is still unfolding,” he said, adding that liberalising the economy turned it into a shutur-e-be-mahaar or a camel without harness.

“Private capital has taken over the world. You have to make policies that are conducive to private capital in order to attract it,” he said.

He criticised the export-oriented sectors for continuously demanding incentives and privileges.

“All exporters are rent-seekers,” he said, adding that the country has no exportable surplus.

If Khan’s dire predictions are proved right, it would be the undoing of Prime Minister Imran Khan's economic policies, who started his tenure in 2018 with about USD 18 billion external account deficit and spent the last three trying to bring it down.