ARTICLE  (January 03, 2011) : John Maynard Keynes taught us how, through lower interest rates and increased government spending, countries can ensure that the economy operates near or at full employment. Unfortunately, however, none of our policymakers in the realms of politics and finance, seems to hold this view any longer.

The outlook for 2011 remains problematic. A very difficult and bumpy ride lies ahead as Pakistan's debt requires a parliamentary waiver in order to earn legitimacy as it has already breached 60 percent of Fiscal Responsibility and Debt Limitation Act (FRDL). Some of the major challenges are: low growth, high inflation, rising unemployment, continued fiscal indiscipline, growing poverty, surging food and energy prices, more expensive credit to private sector becoming more and more expensive, alarming increase in government borrowing, profound circular debt, poor revenue collection coupled with increased spending, growing subsidy and low foreign investments. One of the most important factors is also the failing commitment to IMF. A sustained flow of home remittances from overseas Pakistanis happens to be the lone consolation. Full Story