Even as Pakistan reached $6 billion bailout agreement with the International Monetary Fund (IMF), Imran Khan-led government would have to implement a host of tough measures to honour the commitment.
Even as Pakistan reached $6 billion bailout agreement with the International Monetary Fund (IMF), Imran Khan-led government would have to implement a host of tough measures to honour the commitment. Apart from limiting expenditure, working on the loss-making PSU enterprises, capping the subsidies for the wealthy classes and taxing the rich, Pakistan would have to seriously look into not exerting much burden on the middle class of the country. The experts say that the latest deal, the 22nd since Pakistan joined the IMF in 1950, may invite fresh economic challenges for the common man in the form of rise in prices of goods and services including fuel, gas and electricity. The rupee may get devalued further making its exports less competitive, they added. The last bailout for Pakistan was worth $6.6 billion in 2013.
Even as the government was aware about the likely challenges associated with the bailout and so, it delayed the outcome by three days to May 10. The steep terms placed by the IMF in front of Islamabad were the bone of contention for Khan led government. These talked about fiscal realignments and monetary adjustment, according to Pakistan media reports. The country already is under pressure from the Financial Action Task Force (FATF) to counter terror financing and money laundering. Pakistan, which is already in the grey list, is trying its very best to prevent from falling into the black list. If it’s such, the economy of the country could soon be in deep shambles.
In the announcement made to the public, Pakistan’s finance advisor Abdul Hafeez Sheikh had already announced — since the economy can’t afford to fill the $12 billion gap in its annual payments, the IMF bailout is the need of the hour.