The International Monetary Fund (IMF) is a money-lender to the countries with weak economies throughout the world. In order to give loans, it imposes certain conditions. Pakistan has long been on the receiving end. The latest reports indicate that the money-lender is not convinced. It is demanding more from Pakistan, before it goes on to release the succor of 1.2 billion dollars, to keep the balance of payments in order, and keep the economy afloat.
The masses have already paid a heavy price, as the economy tumbled in the wake of recent political changes. The dollar’s flight is unchecked, rupee is marginalised to the core, and soaring current account deficit and inflation have made life miserable. Now the IMF has reportedly come up with a new wish list, and that is surely tantamount to bleeding the fragile economic indicators. IMF has linked the approval of 1.2 billion dollars with bridging yawning financing gaps – a demanding proposition in these tough times.
In a first of its ironic terms, the donor has conditioned Pakistan’s ability to secure ‘adequate assurances’ from friendly countries for more loans. This is quite a trepid point, and is an antithesis of knocking at the door of the IMF. Why should Islamabad obtain a loan at all, if friendly states are forthcoming? Secondly, the IMF’s condition earlier to censure loans from Chinese commercial banks is another spanner in the works.
While the IMF says that Pakistan has lived up to its conditionalities, what ails it from releasing the tranche? This Extended Fund Facility (EFF) programme is creeping on to check the nation’s patience. The uphill task at hand for the embattled and clueless coalition government is to convince the three main bilateral creditors to chip in at least four billion dollars, in a desperate attempt to overcome the ongoing fiscal year needs of over 35 billion dollars.