IMF sets very tough conditions for Pak to receive bailout package, shows no flexibility

[Indus Pakistan]

Reasons why I despise Musharaf -

• left our jawans to die for no good reason on heights of Kargil and then refused to accept their bodies
• sold our allies in Afghanistan for few billion dollars and handed Afghanistan to India, effects of which still persist.
• gave Karachi to Altaf bhai who then was crowned king of that city for over ten years

 

[Yaseen1]

No need of going to imf. We should manage economy by cutting cost and army should rule country as running political govt is expensive

 

[Sine Nomine]

Agreed and replace him with Altaf bhai.

Well if they won't give money to him,he would put them in sacks.

Reasons why I despise Musharaf -

• left our jawans to die for no good reason on heights of Kargil and then refused to accept their bodies
• sold our allies in Afghanistan for few billion dollars and handed Afghanistan to India, effects of which still persist.
• gave Karachi to Altaf bhai who then was crowned king of that city for over ten years

Mushi is dark spot in our history.

 

[Winchester]

Regarding increasing the tax collection, why don't we privatise the collection of taxes.?

Just get rid of the lazy FBR. These guys have made us the worst performers in the region as far as tax collection is concerned.

We face extraordinary challenges and these challenges require extraordinary measures. Recently even Australia has started outsourcing visa processing to contracting companies to speed up the process.

 

[AgNoStiC MuSliM]

He can implement harsh economic reforms without having to care about parliament or two third majority crap etc.

That's what the IMF wants too - harsh economic reforms. Expect rising utility and fuel prices, the rupee has already been devalued.

I am not sure why the Anti-money Laundering Laws of UK are not working in favour of Pakistan Tehrik-e-Baqwas.

Maybe you can ask PM Imran Khan who promised $200 billion within first two days of his premiership for a clarification.

OK, sorry, the two hundred billion does not exist. Many apologies!

Now moving on, what would Ganja have done differently to fix the economy? He did nothing to address the upcoming crisis the 5 years he was in power.

 

[Indus Pakistan]

Time has come to bring the war to these Pakistan haters. PML-N and PPP are Pakistan hating parties. They only serve their own interests.

Your right to a degree but you want civil war in Pakistan? That would wreck the country.

They are working, but none of the solutions are popular. Here's the scenario from a layman's perspective, and those of you better versed in economics are free to correct me wherever you feel necessary:

1. Pakistan imports a lot more than it exports (resulting in a current account deficit). So how do you reduce the CAD?

Reduce imports and increase exports. Devaluing the rupee helps with increasing exports and reducing imports, but you also have inflation. Additionally, you don't just have exporters 'sitting around', it's going to take time for increased orders to come in and be fulfilled and the results seen. The majority of the increase in exports is also going to be from established industry like textiles etc, and this is where you run into another bottleneck - the narrow industrial base of exportable products in Pakistan. Diversification of the industrial base will take years, perhaps a decade or two, provided the correct policies are put in place.

2. Revenue shortfall. We are all aware of the issues with revenue collection in Pakistan - most Pakistanis don't pay direct taxes. IK is frustrated enough to have threatened to disband the FBR, but there are no good solutions in terms of what would be done next if that threat was carried out. The reduction in imports that is necessary to curb the CAD mentioned above also has an impact on revenue collection because you lose the revenue from duties/taxes imposed on imports.

So, the core of the problem, as I see it, is revenue generation, and to generate revenue you need the domestic industrial base to expand which is a long term process. So in the interim, the need to reduce the CAD results in going to lenders such as the IMF, who obviously want their money back and want to see revenue generation increased so the government is left with limited options such as increasing the prices of gas, electricity, fuel, cutting development funding etc.

None of this is a situation the PTI created, and the PTI is correct in pointing out that it inherited problems that have no quick fix, and will require a lot of pain to address.

Great post. The reality is to set the economy on the right path is long term project and if done assidously will bear fruit in at least over a decade. Meaning PM IK will never see a booming Pakistani economy. All he can do is set the scene for future success. Amongst others this is what I expect of him -

• poverty allieviation
• increase in literacy
• bringing FATA and other ignored regions upto par. For too long Pakistan is described by Karachi, Lahore. It's time 200 million people began to express their views on the national tapestry.
• improve Pakistan foreign image which is being slowly done.
  

Now moving on, what would Ganja have done differently to fix the economy?

Bought another apartment in London?

 

[Crusher]

He has already taken control in shape of Niazi

I know this guy is puppet, he has been given the chance but so far he is failing in almost everything.

 

[rizhussain44]

Because he is going to leave you in a far worse condition than Nawaz did.

That's open for debate and speculation. I don't think that will be the case however that's not even the right comparison. The question is, is there anyone who can lead the country better at this time?

 

[Winchester]

We face an export crisis because our textile industry lags way behind in producing value added products.

Our textile exporters are just relying on the low cost cotton fabrics market.

I don't see a marked rise in exports in the short term. This would be a medium to long term process with results starting to come in 2-3 years from now.

Tax collection is where our focus should be. That is doable right now if proper danda is given.

 

[AgNoStiC MuSliM]

The question is, is there anyone who can lead the country better at this time?

No, there isn't.

People can accuse Imran Khan of many things, but even his opponents don't doubt his sincerity, honesty and commitment to Pakistan and her people.

I know this guy is puppet, he has been given the chance but so far he is failing in almost everything.

Once again, LONG TERM PROBLEMS. Judge him at the end of the 5 years, the problems won't be completely resolved but at least we'll have trend lines to look at to determine if the country is on the correct trajectory.

 

[Death Professor]

Reasons why I despise Musharaf -

• left our jawans to die for no good reason on heights of Kargil and then refused to accept their bodies
• sold our allies in Afghanistan for few billion dollars and handed Afghanistan to India, effects of which still persist.
• gave Karachi to Altaf bhai who then was crowned king of that city for over ten years

wow, why you forgot NRO?

 

[Laozi]

None of this is a situation the PTI created, and the PTI is correct in pointing out that it inherited problems that have no quick fix, and will require a lot of pain to address.

Do you think that the steps taken by IK government in the last 8 months are in the right direction ?

My guess is that his delaying the reforms process for this long has pushed your country at least 2 years behind.

And who knows whether IK will bite the bullet or take a U-Turn on IMF bailout with so many strings attached.

All the best

 

[AgNoStiC MuSliM]

Do you think that the steps taken by IK government in the last 8 months are in the right direction ?

My guess is that his delaying the reforms process for this long has pushed your country at least 2 years behind.

I think the PTI tried their best to avoid going to the IMF because of the conditions they anticipated. For a new government, dealing with multiple crises, I think the timeline isn't horribly bad. Could have been a few months earlier.

 

[Pakistani Aircraft]

Please share the reference where he had promised to bring $200 billion in first two days. Khota briyani.

I found this for now. Will that do?

 

[Indus Pakistan]

Well if they won't give money to him,he would put them in sacks.

Maybe PM IK needs to do a deal the Altaf bhai. Clemency but you move back to Pakistan and take over FBR. No taxes equals bori. Watch how tax rates rise ....