Daily Times

Meer Taqi Meer was one of the founders of rich and versatile Urdu poetry. Full of appropriate metaphors and smilies for all occasions, he need not write in million words to seize gravity of a situation like Pakistan’s economic problems metaphorically. He would have simply put it in his most quoted verse-

‘Meer kiya saadaa hain beemaar howay jiss kay sabab

Usee attaar kay Londay say dawaa laytay hain’.

This verse does not need any explanation; just replace the word IMF with the word Dispenser Boys in its pay. It is perhaps the most appropriate commentary on the state of economy and Prime Minister IK’s government going to IMF with a beggars bowl and returning home with bailout or dole out of US dollars 6 million and a finance minister, a governor State Bank and Chairman FBR as the ‘Dispensar boys’ of the physician that has been treating us for ages for all our economic pills without any relief in sinking our economy deeper in the quagmire.

I am not economist but a journalist with a ‘g’, I can only make general comments on learning about galloping high prices back home and growing economic miseries. In order to understand the IMF inflicted wounds I have been through bits and pieces of issues dilated upon by prominent independent experts in the field.

Among those read with great hope to find any silver lining from behind the dark clouds include articles by S. Akbar Zaidi, my friend of many moons former editor of Dawn/News/Express Tribune M. Ziauddin, former Federal Finance Secretary Dr Waqar Masood, Farhan Bokhari of Financial Times, AVM ® Shahzad Choudhry, Columnist of News, Nadir Cheema of SOAS and host of others. Despite their best efforts and niceties of words used, they could not give any benefit of the doubt to the three musketeers from the IMF assigned to carry out the economic strangulation of the country under the aegis of IMF.

Pakistan’s economy is rapidly sliding down to levels not seen for more than a decade, with inflation and unemployment both reaching proportions not seen for a long time. And this is just the beginning

Since I started with reference to Poet Meer’s use of ‘dispensar boys’ as a metaphor for IMF’s three Musketeers, I do not have much of professional skill to dissect IMF dole out, however, the analogy I am using now may look closely appropriate. In the post-IMF deal it seems to be rather hitting the nail on the head when one is reminded of the phrase for situations like Pakistan’s -‘re-arranging the deck chairs on the Titanic!’

Pakistan’s leading economists who don’t bank on government’s dole outs for living have very aptly pointed it out that despite the ‘IMF Dispenser’ boys much badgered IMF bail out, economic uncertainty in Pakistan shall continue, sinking it deeper into a quagmire to certain deluge with no relief in sight. At the time of writing this US dollar had crossed Rs150 and Stock Market was crushing to all time low perhaps fast moving towards total collapse unless government artificially jacks it up.

How has PAKISTAN come to such a tragic pass? Answer is easier than done in Prime Minister Imran Khan’s political lexicon. According to him all has been due to inherited bankrupt economy from former Prime Ministers Nawaz Sharif/Shahid Khaqqan Abbasi. PTI government is so thick skinned that they don’t accept that it is their bottomless policies, anti-corruption mantra and continuous criminal delay in going to IMF, allowing rupee to crash-all contributed to deepen country’s economic problems to the present point of no return.

Now IMF will give Pakistan US Dollars 6 billion spread over 39 months. Regretfully by the time it gets first tranche, Pakistan’s debts would have increased by US dollars 10 billions. Except for those economic experts whose bread and butter is provided by the government, consensus among independent financial experts and economists is that IMF is a recipe to kill the patient and not to cure the disease.

People who go by the body language interpreting Imran Khan’s photograph after the IMF deal show him sitting smugly blushing opposite like a maiden, plays twisting fingers while IMF chief Christine Laggarde has a triumphant smile on her face just like General Jagit Singh. His crime has no doubt being doubly compounded ironically since people despite their short memory have not forgotten all his sins that found fault with PMLN government’s economic policies. Experts say Pakistan is in for inflation thatwill turn into Hyperflation due to Asymmetric Warfare through IMF, FATF, Terrorism and Pakistan’s regional entanglements.

There is a consensus among experts that detailed staff-level agreement is not in public domain. It won’t go to the IMF board for formal approval till July i.e. after the budget. There are some prerequisites of the IMF programme the government is preparing for since August last year. Such as market determined exchange rate, cutting fiscal deficit (increasing tax revenue and cutting expenditure), increasing energy tariffs, decrease in current account deficit, increase in the interest rate etc (most of these policy instruments are interlinked).

IMF programme conditionalities aim to stabilise the economy in the medium to long-run, always have a political cost in the short-term with lethal long term consequences. The economy shrinks, leading to rise in unemployment, higher inflation due to increase in utility tariffs and devaluation. Economists who are critical of the IMF programme refer to unsuccessful programmes in the past in Pakistan (at least 20 times) and other countries, which IMF attributes to lack of implementation of the programmes as stated in the IMF press release that was strongly worded. It is anticipated to be a tough programme because the IMF is expected to demand up-front adjustments based on its past experience. The political and socio-economic cost is going to be higher for the current PTI government because of its high sounding populist agenda which lead to high expectations, forcing IK to make unrealistic promises in pursuit of a false dawn.

According to Dr Akbar Zaidi various perceptions forced on Pakistan as fait accompli confirm that Pakistan’s economy is in a disastrous state. He claims that even PM Khan and his first finance minister Asad Umar had accepted this bitter truth. In fact, as the last elected politician to hold the job as finance minister and a friend of Imran Khan who once considered him as an economic wizard, was fired by Khan precisely because he rendered the economy in a deep mess. Zaidi says that not only every key economic indicator is in poor shape, all available information suggest that things are going to get much worse over a period of time starting from now. Pakistan’s economy is rapidly sliding down to levels not seen for more than a decade, with inflation and unemployment both reaching proportions not seen for a long time. And this is just the beginning.

To be continued

Author is the former High Commissioner of Pakistan to UK and a veteran journalist