Pakistan accepts 11 tough conditions from IMF

Society Pakistan & World Affairs
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The IMF looks set to impose its “medicine” on Pakistan. The article quotes a Pakistani official as saying that the IMF has been putting pressure on other countries friendly to Pakistan to stay clear of bailing Pakistan out, so that Pakistan has no choice but accept the IMF and its terms.

Pakistan accepts 11 IMF conditions

-the Pakistan government has agreed to gradually impose the Central Excise Duty (CED) on services and agriculture sectors at the rate of eight to 18 per cent in place of the General Sales Tax (GST)

-the Pakistani currency will also be devalued after slight changes in the discount rate and exchange rate will be decreased officially by six to seven per cent

-the release of 60 per cent funds for the next three quarters of the current financial year, under the Public Sector Development Programme (PSDP), would be reviewed downward to 45 per cent.

-freezing of non-development expenditure under the defence budget for the last three quarters of the current financial year

-non-provision of supplementary grants to government departments

-ending subsidy on gas and electricity

-20 per cent reduction in non-development expenditure of civil departments and federal ministries

-increase in markup rate of banks and on inter-bank transactions

-uniformity in the inter-bank and open market dollar exchange rate

-stoppage of government financial intervention in stock markets.

-the IMF will be informed at the time of the issuance of credit line by any international financial institution, including the World Bank

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Re: Pakistan accepts 11 tough conditions from IMF

sigh This is what happens when you have a crook for a President. Good to know we will sell out to the US agenda once again.

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Re: Pakistan accepts 11 tough conditions from IMF

whats are the consequences of defaulting?

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Re: Pakistan accepts 11 tough conditions from IMF

what do u accept!!!
IMF is saying to freeze non-development expenses, we should have done that months ago.
IMF is also asking to have same bank and open market rate, we need to uniform it long long ago.. thanks to IMF that it have rnow focused on it.

I don't agree to devaluation of the currency but it is in the package

I think govt. is saying that they have plans to end the subsidy on electricity, which they have exercised in recent past.

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Take food away from poor.

We have got used to it by now, haven’t we :D… around 35% devaluation in last 7 months.

So where would this money go?

Govt already tried it, then backed out. If it is to be done then govt should let free-market work its way instead of controlling prices.

I agree :smiley:

When countries around the globe are lowering interest rates to boost economic activity some chump in IMF thinks boosting this rate will support economic activity? :eek:

I think all (int’l) govts are doing this, have done it in one way or the other.

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Re: Pakistan accepts 11 tough conditions from IMF

Okay...if Pakistan gets IMF loan...what Pakistan would do with it?

Just to pay some bills for now...wow... :D

After a couple of months...you will be asking loans again to pay the next bills...we sure are wound up in a vicious circle...never will get out it...dum dum diga diga...mausam bhiga bhiga... :D

PS: Can we produce enough to pay our bills...seems to me highly unlikely in the current scenario... :)

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IMF is not the monster we are making it to be. They in their "big government" view, are trying to help Pakistan "balance the sheets".

Some of their suggestions are good, while others will surely lead to more troubles for ordinary Pakistanis.

However Z has asked the right question.
**
Can we produce enough to pay our bills...seems to me highly unlikely in the current scenario?**

And the answer is Yes We Can!

This is the time we sell our services and products to the West better than what we have done in the past. Why is it important to sell the services to the West?

Well they are the only ones who can buy our services and in turn pay us $$. Their local costs are higher than Pakistan's. And the difference results in cost savings for the West and foreign exchange for us.

China and India cannot buy our services because their own services are either below our cost or at the same level.

Middle East is another example where we have been selling our services. But we have done terrible job in "packaging the service".

Our shalwar kameez wearing, little-educated folks should have been given pant-shirts and basic English and Arabic education before being sent over.

Instead we let our uncouth uneducated human resources to be exported. This has brought us bad name, and lowered our expected income.

Moreover the Middle East like UAE, Saudi, and Kuwait where we can export our services are under the heavy influence of the West. And Iraq is under Western occupation. Thus working closely with the West should have been our top priority, but we unfortunately carry anti-West animosity with pride.

Thus our rice and our people both get packaged very poorly. With our religious zeal, we may not be able to send labor to Iraq either.

Think about it. Iraq will go through huge construction boom and only pro-West people will be allowed to work there.

Think Afghanistan. We are hell bent on kicking NATO out. Instead we should have worked closely with them so we could get HUGE benefit from Afghanistan's construction boom.

In summary, we are wasting away opportunities all in the name of ucouth tribalism. We are wasting away opportunities to earn $$ like China and India have been doing for a while now. They both are eager to please and serve the West. While we the beggars are content on begging the money instead of earning it.