‘Latest IMF projections’

This is apropos a Business Recorder op-ed “Latest IMF projections” carried by the newspaper on Tuesday.

The writer, Dr Hafiz A Pasha, has analysed the Fund’s assessment in a meaningful way by saying, among other things, that “however, the outcome of the general election has opened up uncertainties about developments on the political front.

This could heighten risks also on the economic front and make it more difficult to achieve any improvement in the state of the economy.” The focal point of his conclusion, in my view, is the “political front” phrase.

No doubt, the Feb 8 general election has unfortunately given birth to a highly toxic situation owing to deeply polarized mandate besetting the country in which the task of achieving political stability seems to have become a formidable challenge for any political party or a coalition of political parties.

That is why perhaps the recent general election could be described as the most controversial one in the entire history of the country.

Having said that, I wish to make two points in relation to the approaches of two adversarial political forces to the IMF and its programme.

Pakistan Tehreek-e-Insaf (PTI), which is vying to form its governments at Centre, in Punjab and KP, is not in favor of going back to the IMF; it has even hinted at the possibility of saying goodbye to the lender of last resort for ever.

Insofar as the Pakistan Muslim League-Nawaz (PML-N) and its partners such as Pakistan People’s Party (PPP) and Muttahida Qaumi Movement (MQM) are concerned, it is increasingly clear that the incoming government’s approach to the Fund would not be different from Pakistan Democratic Movement (PDM) coalition government’s and its successor or current interim government’s.

The likely arrival of PDM coalition, which is aptly described as ‘PDM 2.0’, will surely augur well for the health of the ongoing Pakistan-IMF Standby Arrangement and the prospects for future Fund programmes for the country.

In other words, the Shehbaz Sharif-led coalition government will be expected to work harder to help lower risks on the economic front. However, it has to be seen how it will go about achieving political stability, which, without an iota of doubt, is a sine qua non of economic stability.

Rasheed Ahmad Chughtai (Karachi)

Copyright Business Recorder, 2024