IMF loan delay pushing Pakistan economy “into a tailspin”: Report

Islamabad [Pakistan], February 17 (ANI): Pakistan’s historic high in petrol price and International Monetary Fund’s delay in sending loan is pushing the country’s economy into a “tailspin,” Islam Khabar reported.

On Wednesday, Pakistan hiked up the prices of petrol to Pakistani Rupees (Rs) 272 per litre and gas in a bid to appease the IMF for unlocking the critical loan tranche, reported Geo News. The petrol price has been increased to Rs 272 per litre after an increase of Rs 22.20, a press release from the Finance Division read, noting that the surge has taken place due to the rupee’s devaluation against the dollar, as per the Geo News report.

Pakistan is in panic after the IMF team that came to negotiate the details left without reaching a final agreement last week. Even though Finance Minister Ishaq Dar and Prime Minister Shehbaz Sharif agreed to all the preconditions. And now Pakistan increased the petrol price which is increasing the burden on a breadwinner.

The IMF, Saudi Arabia and the United Arab Emirates have been interfering in Pakistan’s polity. They have been calling for structural reforms in the economy when the people are suffering at the delay in the release of the IMF’s tranche, as per the news report.IMF’s statement on the talks underscored the gaps despite the progress made on the measures to remedy domestic and external imbalances.

“The IMF’s carefully crafted, short concluding statement on the 10-day loan talks further underscores these gaps, despite the “considerable progress” on measures to remedy domestic and external imbalances,” Islam Khabar quoted Dawn’s editorial.

Pakistan commentator F S Aijazuddin asked, “Why does the IMF repeatedly expect Islamabad to implement long-term solutions (such as structural reforms) when governments there govern from day to day?”

The inflation in Pakistan is at 33 per cent, which has witnessed a rise from 19.7 per cent in March 2022, with daily necessities like wheat flour going beyond the reach of the middle class, according to Islam Khabar’s report. Tea has become expensive with a shortage as Pakistan does not have the necessary foreign exchange to secure the release of shipments awaiting clearance at the Karachi harbour for the past three months.

As foreign exchange reserves decline to below USD 3 billion due to dwindling official foreign inflows. However, the dire situation has not stopped profligacy in Pakistan, as per the news report. In addition to the political blame game, the failing economy of Pakistan has not stopped the political class from engaging in their daily zero-sum game and taking all their disputes before the highest court.

Pakistan has continued to import used cars worth billions. Pakistan Prime Minister Shehbaz Sharif has cancelled imports as that would anger the privileged classes who have scuttled the reforms that the IMF and friendly nations have raised the demand for, as per the news report.

Sakib Sherani, who has been on several Economic Advisory Councils in the past warned that even the city-dwellers are cutting down on food and medicines, Islam Khabar reported. He said that middle-class people have been seeking help from strangers.