While the government has so far been unable to secure the next tranche of the IMF bailout, it is being reported that we might as well now seek out a fresh programme to meet the growing external financing requirements for the year. This year alone, the financing gap looks to be at an estimated $6 billion. If not the IMF, this money would have to come from somewhere.
With growth floundering and prospects for the economy remaining bleak, Pakistan will have to continue seeking out fresh loan arrangements with the IMF and other international bodies unless the government makes a policy shift to improve the economic situation.
For this, there must be targeted initiatives taken in industries that can help us on our way to recovery. Top of this list should be the IT sector, which has resiliently managed to survive despite many challenges, including the government’s policies. Optimistic experts claim that Pakistan’s IT exports to Africa alone can bring in $1 billion in revenue in a couple of years. However, this is easier said than done. When the government can shut down the internet without warning to stave off protests. There have been documented cases of IT startups losing funding because of the unreliability of telecom and internet services and government policies. The PTA’s overzealous approach to content screening does not help the ecosystem either.
We are at a point where the economy has to be ushered towards growth by the government. Otherwise, the stagnancy will continue to make matters worse regarding the rupee devaluation, inflation and unemployment. There is potential for growth in several sectors including agriculture, but the government must choose to move away from stagnant policies that stifle growth and keep us limited to the option of borrowing to survive.
At this point seeking out a new loan programme is inevitable. The debt servicing commitments alone demand it, not to mention that reopening the economy will also require an increase in the import bill. But the next government that comes in needs to do its homework and have a plan in place for rejuvenating the economy. It is hoped that any upcoming election campaign will focus on this, rather than the mudslinging that has all but replaced political discourse.