Preparing a budget is always a difficult and daunting task for policymakers, especially in a country that relies on foreign borrowing. The challenge lies in managing liquidity due to maturities, rollovers and interest payments, which hampers growth and development, preventing funding for infrastructure and social welfare initiatives.

Additionally, the country is exposed to global influences due to a lack of investor interest, liquidity limitations resulting from associated risks and asset quality, and fluctuations in global interest rates driven by various types of uncertainties. In such circumstances, the nation mostly has to depend on external donors.

This unpleasant reality is a significant contributor to fiscal imbalances. Tax evasion and inadequate tax collection occur because a large portion of the economy operates outside official channels.

Furthermore, the reliance on short-term financing intensifies the burden as funds need to be consistently rolled over for timely payments. Ultimately, this situation increases the risk of currency depreciation and contributes to higher inflation rates.

While lower costs, reduced interest rates, and the use of long-term debt financing or buybacks may serve as temporary fixes, they do not offer a sustainable solution.

Without expanding the tax base, sustained economic growth will not improve the overall tax collection proportionately, which directly impacts the declining tax-to-GDP ratio.

The primary objective should be to decrease dependence on foreign borrowing, which cannot be achieved without substantially increasing both tax revenue and exports simultaneously.

Export growth and economic prosperity are both dependent on providing........

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