Trapped in the IMF Web: Pakistan’s Struggle for Sovereignty
One cannot help but reckon on the the vulnerable state of the economy of Pakistan and how the country managed to engrave itself in the deep valley of instability and economic doldrums. Even after 76 years of independence, Pakistan’s struggle for sovereignty continues, and it is crucial to ask the source of this. To answer this question, we will look at the unwavering kindness of the U.S-led “International Monetary Fund (IMF)”. The main culprit behind the veil of assistance is the structural reforms of the IMF.
Role of IMF in killing the economic prosperity in low-income countries is like a Trojan horse that enters in the countries by disguising its dismantling weapons under the wooden shell of loans and assistance. Long lugubrious history of the countries like Venezuela, Mexico, Mali, Egypt, Argentina and Pakistan delineate the story of a monster that loves to stumble its prey with glittering gold of loan. The debt trap diplomacy is a deep dark well that has no end and countries keep on falling in it.
How the IMF traps its prey is itself interesting. It helps the countries and gives them a helping hand in the economic down-turns and later imposes costly structural reforms such as fiscal consolidation and austerity measures. Rise in taxation, cutting of government spending over the public development programs, price hike of food and oil, and reduced military budget are some tactics of the organization that beautifully capture the economically tormented countries.
Read More: Wreck-ed State of National Affairs
Pakistan – being its prey since 1958 – has been accepted with all the conditions of the programs in order to enjoy the indebted money. However, the results are always drastic that lead the country in the dark alleys. This vulnerable country is attaining 23rd bailout package in the name of the “Extended Facility Fund” this year. Every year starts with the fear of being defaulted but then our imprudent leaders present themselves as the most miserables who are in the greater need of debt and to borrow money to pay the borrowed money back. This vicious cycle goes on and will be keep going on, until or unless, the government take serious measures to solve all the concerns of economy.
1) Pushing for an Export-led Economy
One of the first measures that government can take is to provide sustainability-led calcium to the bones of the weakened economy. To make the economy sustainable, it is important to review the balance of payment factor. Hence, it is quite disturbing in the arena where export and import crisis is prevailing. The ratio of import is way much elevating than the exports. Making Pakistan an export-led economy will be considered as panacea for ill-treated economy.
2) Attracting Foreign Direct Investments (FDIs)
Second pertinent measure that Pakistan needs to take is to level up its Foreign Direct Investment (FDI) . There is a dire need to make the environment conducive for foreign investors to come and invest in the country. To invite butterflies in the garden, one has to grow flowers in it. Similarly, in order to invite foreign investors Pakistan needs to give confidence to them by strengthening its economic, political and social conditions. Threats of terrorism, instability in economic and political atmosphere, and currency value depreciation are the factors that make the investors reluctant.
It is scrutinised that all the factors are interlinked to each other. There is an invincible bond among the social, political and economic prosperities. Solving the issues of state will eventually boost up economy and this, in turn, will lose the dependency of the IMF to accelerate the state’s machinery.
Hence,in the realistic description of the states condition, it is required to make the country free from the piercing claws of IMF by adopting various measures that ensure to strengthen the country wealth.
Author is the graduate of BS English. Her interest in realpolitik of the world compels her to write on the prevailing issues.