The government has finally budged. The Dar factor to keep a check on the dollar rate did not work. The current system could have either kept its electoral capital intact or let the country sink further into an economic quagmire. It decided to put the country first. After the removal of the unofficial cap on the dollar rate, the market’s confidence has risen, the stock market is witnessing a bullish trend, economists are positive, and the revival of the International Monetary Fund (IMF) loan programme seems to be in sight. All these factors would enable the IMF to release the desperately needed $1.2 billion – provided its terms are met. One of the main requirements of the IMF’s ninth review was to see the rupee-dollar rate settle at its market value. Within 24 hours of the cap removal, the dollar rate shot up to Rs 255 in the open market and Rs 250 in the interbank market early Thursday morning. The cap removal reduced the gap between the open market and interbank rates in terms of dollar rates after almost 15 months. At the end of the day, the rupee had fallen a record 9.61pc in the interbank. Just the day before, it was around Rs 230. To build the exchange companies’ confidence, the government had asked the private banks to make dollars available to them, but so far the directive has not been followed. According to analysts, the dollar rate will stabilise once the exchanges get the greenback, but at the moment, there are more buyers than sellers. Besides, the government will also have to fulfil certain other requirements of the IMF. Among them, an increase in petrol prices is also on the cards. There are also reports that a cut in government employees’ salaries is another condition, but so far it has not been confirmed. With Imran Khan announcing that he would enforce the IMF conditions if he returns to power, the Shehbaz Sharif government will have to move on, take unpopular decisions, and risk its already eroding vote bank. After clearing a Chinese loan on January 24, the reserves have shrunk further. The first lifeline is the IMF. Pakistan needs to get off the ventilator and push itself out of the economic crisis in which it is trapped. But that’s not all. We need to take drastic measures to shore up our reserves. The present setup does not have many options. Meanwhile, as of now, citizens may have tough days ahead, but not as bad as they could be if the country goes bankrupt. *