Detangling the financial yarn

PTI wants to be known as a results-driven government. In the two months since taking reigns of the country, the PM, Imran Khan, has painstakingly turned all stones, looking for means to aid the damaged economy. The only international visits the PM undertook, thus far, were to consolidate the national kitty.

Khan and his ministers say that this fiscal year poses the largest financial challenge for Pakistan in its entire history and hold the previous government responsible for mismanagement and corruption leading the country to a financial abyss.

The increasing international alienation and both national and international development initiatives—including China-Pakistan Economic Corridor—CPEC, are, among other, reasons the United States had shown distrust towards Pakistan. The United States President showed his reservations on the possible bailout of the country by IMF. And previously, the “do-more” demand by President Trump’s government—holding Pakistan responsible for the unrest in Afghanistan—cost Pakistan suspension of $300 million military grant.

The challenges of this magnitude need efforts to match.

When Islamabad’s preliminary talks with Riyadh and IMF didn’t pan out, it was time to get down on the drawing board. Meantime, growing pressure from the political opposition mocked the government for claiming to break the begging bowl. There was also a fear among the politicians and analysts that IMF could make Islamabad rollback on her CPEC plans.

In this financial backdrop, the PM’s recent visit to the Saudi capital bore some results. The “Good news,” was a $6 million funding by the Riyadh with a possibility of revision after three years. Some say that the scandalous killing of Khashoggi may be the determining factor behind the offer. The government quarters are hopeful that half of that amount’s funding from Beijing will bail Islamabad out of deep seas. IMF could help with the rest and the possibility of development funds from World Bank and Asian Development funds would be possible.

PTI knows that without foreign help their government will not be able to deliver on the pre and post election promises. But the details and conditions of the Saudi Funding are still said to be in the works and not been shared with the parliament. Analysts expect a deeper military cooperation could be on the Saudi wish list. Islamabad-Riyadh relationship turned sour in 2015 after the parliament agreed not to participate in Yemen War and Islamabad wished to mediate between neighbouring friend Iran and Saudi Arabia. That stance could weaken now that a bailout had been made by Saudis. The relaxation of Crown Prince Salman’s views on Israel has also irked many in Pakistan and the rumours of an Israeli official visit to Islamabad add to these worries.

Imran Khan would gain a measure of trust from his political peers if takes them onboard and the details of the Riyadh deal were transparent.

Previous Educate children and save them from being molested
Next Pakistan’s media in dark ages