The International Monetary Fund and Pakistan are locked in such a fraught relationship that neither can completely rely on the other. Pakistan’s precarious economy always stays at the mercy of external support, and the IMF has never disappointed it. But the subsequent conditionality always leaves mistrust between them.
While every Pakistani government says it was the last IMF program, it again rushes to the fund when the falling indicators and balance of payment position scare it. Frankly speaking, it is the international credence of the IMF that encourages commercial lenders to be soft on the debt-ridden Pakistani economy.
It is also understandable if the Pakistani people point fingers at the fund when price-hikes, ever-growing taxes, and denial of subsidies press them hard. That is why successive Pakistani governments have faced the brunt of public criticism after every IMF program. Consequently, mistrust grows when the government is reluctant to meet the fund’s borrowing terms and the fund gets hesitant to release the next tranche and the country slumps into a near default situation. Rather than pushing the country to some safer shores, this debt circle keeps on spiralling. The question is where the fault lies.
Pakistan is a responsible player in the prevailing world order being run under an integrated network of the United Nations, world powers, regional geopolitical blocs, global human rights and other organizations and international financial institutions with IMF, World Bank, IDB and ADB at the helm. Despite occasional clashes of interests, Pakistan has always worked in tandem with the ethos of the international community. The world has also not left Pakistan in the lurch in difficult circumstances.
If we have to put our economy on soundtracks, the government has to run a strict austerity drive with a five-year curb on even development projects.
For its part, IMF also has a record of successful programs in other parts of the world, particularly in Tunisia, Jordan, Nicaragua, Senegal, Cyprus and many other countries in Asia-Pacific, which have remained models of its success stories in recent years.
If we have to put our economy on soundtracks, the government has to run a strict austerity drive with a five-year curb on even development projects. In modern democracies, countries are run by political parties whose fate is decided by the people based on their performance. The people of Pakistan are not that much short in political awareness that they cannot make saner decisions. In every election, they have never voted for the party, which has shown poor performance in the previous time.
No government ever has been allowed to complete its five-year tenure and let the people judge its performance. Every time, the military establishment intervenes halfway and sends the government home with a new set of politicians cobbled together for a new dispensation.
After exhausting all experiments with the conventional political parties, the establishment, banking on the popularity of Imran Khan – whom it later dubbed as a cowboy – concocted the concept of a hybrid regime, which rather left the country in shambles.
In recent weeks when the present coalition government aired some reservations about the IMF program in the face of the coming generation elections, the feeler of a technocrat government was released to pressurize it.
It is not that the Pakistani military establishment is repressive or autocratic, like the ones in Myanmar, North Korea and many other countries in the region. But politics and statehood have their dynamics and parameters. One can subvert the course of history at a whim but the outcome is always horrific.
Our judiciary has also played a negative role in the name of judicial activism. Even chief justices of the Supreme Court and High Courts have passed overt partisan decisions in political cases.
Never can a state attain its true strength and character unless all its pillars i.e. the legislative, executive, and judiciary, work independently – albeit under a system of reciprocal checks and balances. A vibrant and functional civil society with strong media is also inequitable for a functioning state.
General (R) Qamar Javed Bajwa has claimed that the Army had decided in February last year to stay neutral and refrain from interference in political affairs. It is now to see how far that promise is being honoured.
The prime need for a dynamic economy is a stronger political government with a team of capable political economists. Unfortunately, Pakistan has, for decades, been seeking banking solutions to its economic problems. No economist worthy of the term has even been inducted ever since Dr Mehboob-ul-Haq in the 1980s.
How can the country escape the vicious circle of debts when the thrust of every economic team’s efforts remains focused on securing further borrowings for servicing previous debts? Never have we even thought of boosting our agricultural, industrial, trade and technological productivity. But our politicians are busy in such a harsh power game that they can pay little attention to their original job.
If we have to put our economy on soundtracks, the government has to run a strict austerity drive with a five-year curb on even development projects. While our surrounding countries have, since their beginning, harmonized their speed of life with their economic growth, we are parroting Europe and Western societies.
Putting the economy on stronger footing requires tighter curbs and diverting resources to more productive sectors, even if we have to go into default or change our lifestyle.
He writer is an independent freelance journalist based in Islamabad covering South Asia/ Central Asia.