IMF Imposes Strict Conditions on Latest Bailout Package for Struggling Pakistan Economy

Pakistan is currently at the beginning of the worst condition since its independence. Pakistan has taken fourteen loans from IMF thus far, and none of the exchange to IMF. It raises a serious question about the capacity and capability of Pakistan to get out of this blank wall. Pakistan may face a disaster like never before unless china and Saudi Arabic bailout the country. The Pakistani rupee has raised PKR 250 against the dollar. The currency has to forego 12 percent of its value. The petrol prices have up lift to RS 35 Per liter.

Pakistan Prime Minister Shahbaz sharif on Jan 24 said the ruling party PDM will sacrifice its politics for the country. He also said that country is ready to accept the IMF’s strict conditions to restore the moneylending program. IMF had a video link conference with Pakistan officials. IMF will not relax the current situation and not release the next installment until and unless the Pakistan government keeps its promise. Pakistan will get USD 1.2 if accepting the conditions of the IMF with the addition of funding from Saudia Arabia, UAE, and China institutions lenders.

The challenge to Pakistan is that it has not fulfilled the conditions of IMf. Pakistan’s economic struggles have persisted for over three years. The suspension of the IMFs bailout package in 2020, losses from floods in June 2022, and political mismanagement led to an economic crisis in 2022.IMf recently conducted its first round of table talks with Pakistan and said the funds would share nine tables, consisting of the macroeconomic and fiscal framework, with Pakistan rulers will lead to the upcoming policy discussion in the next week

If IMF and Pakistan government have common consent by Feb 9 they will sign a staff-level agreement. The authorities have massively updated the macroeconomic framework and shared it with the IMF. The real GDP growth is 5 percent, projected to reduce to 1.5 or 2 percent. The inflation will rise from 12.5 percent to 29 percent. The visiting IMF team has pointed out that the increase in the production of dollar value over time is targeted to cross 30 percent. Federal board revenue of Pakistan tax to GDP ratio is bound to decline even if it gains the imaginary annual tax collection target of RS 7,470 billion.

Shahzaib Dyer
Shahzaib Dyer
Shahzaib is content writer with over five years of professional experience. He is creative, hardworking, and possess extensive research skills. Being analytical in approach is highly reflected in his writing.


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