A statement quoting former Federal Board of Revenue chairman Shabbar Zaidi has been the subject of debate for the past two days now in which he claimed that Pakistan has gone bankrupt. What does it mean to be bankrupt? And is the situation in the country is worsening?
Let’s take a look.
What does ‘Bankruptcy’ mean?
When an individual or companies find that they are unable to repay their debts, legal action is taken and the debtor himself or one of his creditors seeks bankruptcy in court. The civil judge orders recovery and as a result, a receiving officer takes possession of the debtor’s property.
The debtor gives an affidavit of his condition and his case is regularly examined. In case of agreement between the debtor and the creditor, the debtor agrees that he will pay a certain portion of his income to repay the debt. For example, 15 rupees or 12 rupees will be paid to your creditors.
However, in the absence of consent, the court declares the debtor bankrupt by law and the creditor appoints a person as trustee for his property. The bankrupt informs the trustee of all the property, the trustee reviews the accounts and fulfills the demands of creditors as much as possible by fraudulent calculations, and by selling the property, such a debtor is called bankrupt.
Shabbar Zaidi’s first claim
Former FBR chairman Arshad Zaidi said in his inaugural statement that the government’s statement that the country is doing well, “We have achieved great success and we have brought change, it is all wrong, I think the country is bankrupt. has been done,” he said.
Addressing a function, Shabbar Zaidi said that we have been saying that it is very good, there are great things and the country is running very well, we have achieved great success and we have brought change but it is all wrong.
Shabbar Zaidi said that when you decide that we are bankrupt and we have to go beyond that, “It is better than you say that the country is doing well, I will do this, I will do that. These are all deceptive things,” Zaidi added.
Shabbar Zaidi’s second statement
Explaining his earlier statement, former FBR chairman Shabbar Zaidi said, “Yes, I said there are bankruptcies and other issues with the persistent current account and fiscal deficit but solutions will have to be found.” Expert opinion
Regarding the claim of tax expert Shabbar Zaidi that the country is bankrupt, economists say that Dr. Anjum Altaf said that the rate of inflation is increasing and the rupee is depreciating, looking at the general definition of bankruptcy. “We have no means of repaying all the loans we have taken and they are taking more loans for repayment, so technically the country is not bankrupt,” Zaidi maintained.
Analysts said that Shabbar Zaidi’s statement is true that contrary to the government’s claims, the economy is not doing well, the situation is difficult but Pakistan is not going bankrupt, the country’s economy is facing a current account deficit and fiscal deficit but this Not the deficit that has not been seen in the past, the government is taking steps to reduce the current account deficit, he asserted.
Effects of being married
There are also reports that when a country goes bankrupt, its assets abroad are confiscated, exports are blocked, the country’s ships cannot go abroad, luxury goods, vehicles, and other goods cannot be imported from abroad.Â
Prime Minister’s claim
Prime Minister Imran Khan says that we did not have money to repay the debts, when the rupee falls, everything becomes expensive, by the grace of God we have come out of a very difficult time. “Our difficult time is over and a great time is coming,” he claimed.
