July 10 2008
IN the face of worsening financial conditions Pakistan Government is once again planning to seek assistance from the International Monetary Fund (IMF), sparking fears among people that another period of humiliating conditionalities and dictation is in the offing.
Previous Government of (former) Prime Minister Shaukat Aziz used to take credit of taking the country out of the shackles of the IMF. The hallmark of its policies was ‘trade’ not ‘aid’ and it boasted of breaking the begging bowl. It is a fact that prudent economic measures and continuity and consistency of policies over the last few years enabled Pakistan only to bid farewell to the IMF but also to transform a near bankrupt economy into a robust one, which was poised to scale even greater heights in days to come. Pakistan was sarcastically referred to as one “tranche country” in 1999 but with the passage of time it graduated to a position of one of the fastest growing economies in the world.
This remarkable transition won accolades from all over the world and it was precisely due to this reason that the country was able to absorb and withstand the shock of unprecedented increase in the oil prices internationally. Foreign exchange reserves also remained at a comfortable level and despite regional and international shocks the rupee also remained stable. However, the situation has dramatically changed since March 9, 2007 and the ensuing political and judicial crises are taking their toll. People of Pakistan gave mandate to PPP and PML (N) to stem the rot and take measures for welfare of the people but unfortunately that couldn’t happen. The law and order situation is worsening, foreign investment has dropped significantly, foreign exchange reserves have dwindled enormously, rupee has seen unprecedented fall, stock exchange is volatile, price hike is touching new heights and the rate of unemployment has gone up. The deteriorating security situation and energy crisis have slowed down economic activities and trade deficit has assumed alarming proportions. In this backdrop, the Government is again knocking at the doors of the IMF and it is understood that the required assistance would come with strings attached. This would compound the economic difficulties of the masses who are already hard pressed due to inflation and shortages of essential items. ** We believe that apart from other factors, there is something seriously wrong with the policies of the Government and it would not be an exaggeration to say that the country is almost directionless in the absence of full-time ministers and lack of attention by the top leadership of the country. **