- Will it go beyond the first tranche?
The PTI government has managed to get an IMF bailout on terms and conditions not acceptable to some of the members of the Economic Advisory Council (EAC) and even important Finance Ministry officials. The opposition has demanded to bring the agreement before Parliament for discussion. The measures taken by the government before signing the IMF programme for a gradual compliance with the Fund’s demands have already raised the prices of commodities of daily use beyond the reach of the common man. There is resentment in public over the rise in the prices of basic food items, medicines, school fees, travel expenses and house rents.
According to Advisor Finance Hafiz Sheikh Pakistan and IMF have struck a $6 billion deal to be disbursed in 39 months. Pakistan had already accepted IMF demands like a flexible exchange rate, withdrawal of subsidies, containing borrowings from State Bank and re-initiating the privatisation process. IMF then came up with new goal posts like upfront discount rate by at least 2 per cent, further depreciation of rupee against dollar and a huge rise in gas and power rates to retire the debt of the energy sector.
As the IMF programme is implemented it is bound to put the common man under unprecedented economic pressures. The IMF funds would be disbursed in instalments each one handed over after the tasks assigned have been fulfilled.
The PTI has continued to indulge in politicking instead of taking meaningful measures to reduce government expenses. It publicised selling buffalos and old cars instead of closing down unnecessary ministries and amalgamating less crucial departments. The PM nominated a large cabinet to accommodate coalition partners and an equally large number of advisers with ministerial status. He has allotted funds meant for CPEC development projects to MNAs to retain their loyalties. The Punjab CM travels in full protocol when visiting his hometown, wasting millions of rupees in display of pompousness. Similarly, huge funds continue to be committed to non-development activities. The backbreaking economic burden that the IMF has put on the millions will have consequences. There is a likelihood of the programme to be suspended somewhere in the middle because of its hard terms and conditions.
