IMF package is no panacea, reforms needed, experts say

As Pakistan anticipates the arrival of the International Monetary Fund’s team to revive the stalled loan programme, experts have said the visit only offers a glimmer of hope with more robust reforms needed to stabilise the ailing economy. Former heads of the State Bank of Pakistan (SBP) and Federal Board of Revenue have delineated reasons for economic instability and proposed ‘the way out’. The former SBP acting governor, Murtaza Syed said the IMF team’s arrival offers a glimmer of hope that Pakistan will be able to stave off default. In an OpEd published in an English daily on Monday, Mr Syed said in March 2021, Pakistan had managed to resume the loan programme and received global acclaim for its management of the Covid-19pandemic. “Growth had picked up strongly while government debt had fallen by 6.5[per cent] of GDP, the current account was virtually balanced and foreign exchange reserves had increased by almost 50[pc] to $17 billion,” he wrote. Despite these achievements, he added Pakistan’s growth model remained consumption- and imports-driven, with tax and exports forming a paltry share of GDP.