IMF broke expectations
Pakistan was expecting some help from the International Monetary Fund (IMF). This country has taken loans 22 times even before the IMF. But this time the situation is such that it is difficult to even guess. The floods in September 2022 and the Russia-Ukraine war worked to wet the dough in poverty. Energy prices are skyrocketing and the world economy is also in recession. Pakistan has also now come in those countries of the world which are badly laden with debt. If experts are to be believed, the condition of these countries may also be similar to that of Pakistan. China is the best country in this country and it has given the maximum loan. But now it is also embroiled in disputes with many banks.
who will deal with loss
If experts are to be believed then everyone will have to deal with a loss. It cannot be that the fund is taken from the IMF and then it is spent in repaying the Chinese debt. Various restrictions have been imposed on imports to save foreign exchange reserves of three billion dollars from the government. In such a situation, many containers are stuck at the ports. In the south-eastern Sindh province, a person lost his life last month in a rush to buy flour that was available at a discount. Even running a family has become difficult for many.
Political crisis and terrorism
Political crisis and terrorism have added to the problems of the country. Pakistan changes its finance minister every time. Due to the recent terrorist attack, investors are also getting scared now. They are being apprehensive that terrorism has once again started gaining a foothold in the country. Economic problems are following the same pattern. The country’s dependence on imports and the fall of the dollar have created a balance of payments crisis.
Shehbaz against IMF conditions
Pakistan needs a bailout package of $ 6.5 billion from the IMF. The patience of IMF officials is now paying off. IMF officials are appealing to Shahbaz government to implement stricter measures. They are continuously demanding that the subsidy should be abolished and new taxes should be imposed. At the same time, Prime Minister Shahbaz Sharif is in no mood to accept the demands of the IMF. Elections are about to be held in the country and in such a situation, he does not want to take any risk. Pakistan has a total debt of $ 240 billion and in such a situation the funds received from the IMF are going to prove to be very less.
China must come forward
According to Brad Setser, an economic policy expert at the US-based Council of Foreign Relations, Pakistan has a chance to avoid bankruptcy. Most of the foreign debt on Pakistan ie $ 100 billion is multilateral or bilateral, which also includes western creditors. The IMF and China have about $30 billion in debt and only $8 billion in Euro bonds. US Finance Minister Janet Yellen says that China will have to take steps for Pakistan. According to him, China no longer wants to participate in the talks with the IMF. Because of this everything is stuck.