WORLD NEWS | Pakistan in the depths of economic crisis

Islamabad [Pakistan]March 5 (ANI): International Monetary Fund (IMF) Managing Director Kristalina Georgieva recently said the IMF asked Pakistan to “take steps to be able to function as a country” and not to go into dangerous places. It needs a debt restructuring, the Greek City Times reported.

The IMF chief was quoted by the Greek City Times as saying, “We stress two things, first, increase taxes, because those who make big money in the public or private sector need to contribute to the economy, and, number two, by Take away subsidies from those who don’t need it and distribute precious resources more equitably. The rich should not benefit from the subsidies. It should be the poor [who] benefit from them. “

Read also | Increase in dog attacks: Dog owners mistakenly choose living space to shrink

She further added, “We (IMF) want Pakistan’s poor to be protected.”

As a result, Prime Minister Shahbaz Sharif on February 26 announced a series of measures aimed at tightening the government’s belt, but warned of fears for harsh conditions imposed by the International Monetary Fund (IMF). Get ready for further price increases.

Read also | US airline bans Indian citizen from flying after urinating on US citizen in the air.

Prime Minister Nawaz Sharif also unveiled the austerity measures approved by the federal cabinet and expressed hope that the government will be able to get the masses out of the current economic situation, according to the Greek City Times.

The main highlights of the government’s austerity measures are the removal of salaries and allowances for the prime minister, special assistants to ministers and advisers, and a 15% cut in spending across all government departments. Essentially, the point Prime Minister Sharif made in his interviews with the media was that rich people in Pakistan need to make sacrifices for the country.

Someone needs to ask the Prime Minister why the Pakistan Army has “made a lot of money” over the years and is not asked to sacrifice its funds for the betterment of Pakistan. All the land owned by the officers, the factories and industries they run, and the funds parked in Swiss bank accounts can be used to improve Pakistan’s economy.

More than 20 percent of Pakistan’s annual budget goes to the military.

Under the current situation, Pakistan is facing multiple challenges such as deep economic crisis, political turmoil, and intensified terrorist attacks in the northwest region. All this is draining Pakistan’s resources.

Moreover, the economic deterioration of the country has had a direct impact on the people of Pakistan.

Official sources told News International that the IMF can only help Pakistan overcome a looming balance of payments (BoP) crisis by ensuring that the country is still able to repay its debts without falling into default. Reviving the IMF program is a prerequisite for any debt restructuring, so the government is currently focusing on it.

Only after that is it possible to consider debt restructuring, especially from non-Paris Club countries. Pakistan will require a total of $27 billion in principal and markup external debt repayments in the next fiscal year. The IMF’s ongoing $6.5 billion program under the Extended Fund Facility (EFF) expires on June 30, 2023, and no further extension of the ongoing EFF arrangement is possible.

At that stage, Pakistan will have to seek new IMF loans, taking into account the possibility of large external debt repayment requirements and lower foreign exchange reserves.

Record high oil prices and delays in IMF aid are pushing Pakistan’s economy into “chaos”.

Geo News reported that Pakistan has hiked petrol prices to PKR 272 per liter to appease the International Monetary Fund to unlock key loans. According to the “Greek City Times”, Pakistan’s current situation is the most difficult situation that the country has faced in the past two decades.

However, the IMF’s recent review mission made it clear that the government would have to tax everyone with income.

With only about 3.5 million tax filers in a population of more than 200 million, there is a need to widen the narrow tax base. Following the IMF’s prescription, the government unveiled a mini-budget with a tax increase of Rs 17,000 crore, which is expected to be passed in the National Assembly soon. (Arnie)

(This is an unedited and auto-generated story from a Syndicated News feed, the content body may not have been modified or edited by LatestLY staff)