With the Pakistan Tehereek-e-Insaf (PTI) all set to form government in Islamabad, Asad Umar, the man who is taking over as finance minister in few days, has broadly laid down his strategy to tackle economic challenges confronting the country.
With the Pakistan Tehereek-e-Insaf (PTI) all set to form government in Islamabad, Asad Umar, the man who is taking over as finance minister in few days, has broadly laid down his strategy to tackle economic challenges confronting the country.
Already has been done some homework like convincing Saudi Arabia-backed Islamic Development Bank (IDB) to lend $4 billion that would be used to foot the bill for oil imports.
During Musharraf’s time, Pakistan got a major relief from Saudi Arabia by getting oil on deferred payment. This time around Pakistan seems not to be availing itself that luxury but still the IDB support is not a small achievement as it would spare Pakistan from taking money out of its already depleting foreign exchange reserves to pay the oil bill.
In view of the PTI’s vast support among Pakistani diaspora living abroad, the incoming government may also consider launching dollar-denominated bonds as well as Islamic sukuk targeting overseas Pakistan. According to economic experts, $1 billion to $2 billion could be raised through these instruments.
The incoming government leaders have also hinted at restructuring the sick public entities like Pakistan International Airlines and Pakistan Steels before being put on sale. But these are the long-term schemes which could not immediately provide funds to ward off the imminent balance of payment crisis.
Mohammad bin Salman, Saudi Crown Prince and also the de facto ruler, is too expected to visit Pakistan after the inauguration of the new government and it is hoped that he might offer some help in this difficult time.
China has announced $2 billion loan even before the formation of new government and one expects more such help from Pakistan’s most trusted friend in coming weeks and months.
However, given all these measures, can Pakistan avoid going to International Monetary Fund (IMF) for a bailout package particularly when the United States, the main financial contributor as well as the most powerful country dominating decision-making in the international financial institution, is increasingly going belligerent on IMF’s lending to Pakistan?
A group of US senators are now planning a move to block disbursement of IMF bailout packages to the countries allied to China.
Pakistan apparently tops the list of those countries for hosting the China-Pakistan Economic Corridor (CPEC), the flagship project under China’s landmark Road and Belt Initiative (RBI), which is seen by US policymakers as a Beijing move to expand its clout across the world through infrastructure development.
Moreover, differences between Pakistan and the US over Afghan issue are other reasons for Washington’s threatening demeanour.
Analysts say it is difficult for Pakistan to avoid help from the IMF to address challenges on the economic front; therefore, it needs to formulate its policy as soon as possible to seek a bailout package from IMF by playing its cards deftly.
Despite all strains, Pakistan and the US need each other for a variety of reasons and both of them cannot afford to ignore each other.
All Pakistan needs is the dexterous use of its diplomatic skills to underline the centrality of its role in helping Washington to meet some of its major challenges like the war in Afghanistan.
But it needs a national cohesion at home before the country pleads its case before the US and international forums. The controversy over the transparency of the recently held general elections does not augur well for the much-needed national coherence, which would strengthen the new government’s hands in pleading Pakistan’s case with the outside world.
Any attempt to launch agitation or street protests would not only distract the new government’s attention to address genuine problems of the country but would also weaken new regime’s position in bilateral and multilateral dealings.
In such a situation, the major responsibility lies with the government to engage opposition in a constructive dialogue to address their concerns and grievances in an amicable manner.
The recent assurance by the PTI leaders to the opposition parties that they could consider their demand for the formation of a parliamentary commission to look into the allegations of vote rigging is a welcome move.
In view of grave economic challenges, Pakistan can ill-afford another wave of political uncertainty. It is therefore incumbent upon all stakeholders to act prudently to avoid any misadventure.
The opposition also needs to behave responsibly and should try to resolve the differences within the ambit of constitution and through parliamentary means and traditions.
Though peaceful protest is a democratic right in every society but any move to misuse this right and paralyse the country cannot be defended and supported. It is time for the political leadership to move forward.
The economic situation warrants Pakistan to take bold, long-delayed and tough decisions to put the economy back on track. The incoming government would be a coalition made up of a motely of disparate groups. All it shows that we are expecting a weak coalition which may face difficulties in taking tough decisions. Such a situation would need the opposition to extend its help to the ruling coalition to meet these challenges.
The main question is whether our political leadership would rise above petty politics and show a strong political will to help government in overcoming these challenges?
In ordinary circumstances, one can do politicking for the sake of political gains but in an abnormal situation, as confronted by Pakistan now, one has to show extraordinary courage to meet these challenges. Pakistan could no longer afford to further delay the much needed structural reforms and they need all-out support from every quarter of the society to become successful.
The incoming rulers need to properly use the parliament as a forum to galvanise support for its economic agenda.
All economic policies need to be properly debated in the parliament and they need to have full parliamentary backing before they are implemented so that they have a complete support from the masses. The people of Pakistan need to be taken into confidence on the state of country’s economy and the steps being taken to fix it.
In a democratic setup, any policy devoid of public support is bound to fail. It is, therefore, all the more important for the new government to ensure involvement of people through their representative in decision-making processes.
Imran Khan and Asad Umar have promised transparency in decision-making and policy planning. Let’s see to what extent their work matches their words.
The writer is a senior journalist based in Islamabad
