Pakistan seems to be headed into deep financial turmoil. Thanks mainly to inept and spendthrift leadership and a faulty taxation system. The forex reserves have fallen abysmally low (only covering about 2 months of imports). To safeguard the country from default urgent cash is required.
Since the so-called 'friends of Pakistan' have not stepped in to help and we have saturated all demand to give loan to Pakistan by the World Bank, Asian Development Bank and DFID, the IMF is the last resort.
But under the agreement under discussion Pakistan will have to bend over backwards to say the least. The $9.6 billion loan comes at a markup of 16.7% and has many other conditions attached, such as disclosing all loan information, cutting the defense budget by 30%, decreasing pensioners, agriculture tax imposition, PKR 50 billion increase in taxation, strong role of IMF in making the financial budget and lots of other controls. This is tantamount to selling the ownership of the country. What is going to happen to this country if agreements like this go through is anybody's guess.
Since the so-called 'friends of Pakistan' have not stepped in to help and we have saturated all demand to give loan to Pakistan by the World Bank, Asian Development Bank and DFID, the IMF is the last resort.
But under the agreement under discussion Pakistan will have to bend over backwards to say the least. The $9.6 billion loan comes at a markup of 16.7% and has many other conditions attached, such as disclosing all loan information, cutting the defense budget by 30%, decreasing pensioners, agriculture tax imposition, PKR 50 billion increase in taxation, strong role of IMF in making the financial budget and lots of other controls. This is tantamount to selling the ownership of the country. What is going to happen to this country if agreements like this go through is anybody's guess.
Life is beautiful but it surely does not seem like it at the moment atleast not if you're in Pakistan.
No comments:
Post a Comment