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Executive Director of the Sustainable Development Policy Institute (SDPI), Dr Abid Qaiyum Suleri, while speaking at a seminar on Saturday, said that the economic crisis in Pakistan has been exacerbated due to the global crisis of inflation and that accepting the International Monitory Fund (IMF), despite its strict conditions, is vital.

“Currently, inflation in Pakistan stands at 24.5% which is why accepting the IMF’s strict conditions is vital for our cashflow and economic stability,” said Suleri.

He said that during the past few years, Pakistan had managed to sail through intensifying geo-political tensions – now, however, the future developments seem concerning.

“Loans, even those offered by friendly countries, have become conditional to securing the next IMF instalment,” he said, adding that, “Political forces in Pakistan have realised that, despite its tough conditions, engaging with the IMF is a must and taking unpopular decisions is going to be inevitable.”

He stressed on the importance of supporting the government in reviving the IMF programme saying that demonising the IMF, and other international finance partners, will not benefit anyone.

Referring to the recent international financing pledges, he said, “We cannot rely on the pledges to shore up our foreign exchange reserves. The government needs to strengthen social protection to cushion the lower income segments during this economic crisis.”

Stressing on the need to achieve political stability, Joint Executive Director of the SDPI Dr Vaqar Ahmed said, “The lenders only want assurances for the repayment of long-term loans when the economy is undermined by political strife in the country.”

Speaking at the occasion, Assistant Professor at Habib University, Dr Aqdas Afzal warned that by agreeing to the IMF’s conditions, the country will only avert the immediate crisis. “The storm is not over yet,” he said.

Published in The Express Tribune, January 22nd, 2023.

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