ISLAMABAD: The unrest and unprecedented political turmoil caused by the economic slowdown in Sri Lanka has set off alarm bells in the Indian Ocean region and is among the fastest. PakistanAccording to foreign policy analysis.
“We may not be in Sri Lanka’s shoes yet, but not too far as there are some comparable traits. With talks with International Monetary Fund Obviously inconclusive, and the much-awaited financial aid coming from friendly countries, the country is not in good shape,” journalist and author Zahid Hussain warned daily in Pakistan dawnAccording to a report published in Islam Khabar.
Like China, Sri Lanka is also indebted to China in huge debt and investment. While Sri Lanka has defaulted on repayment and is already in a debt trap, Pakistan ranks second with investments under the China Pakistan Economic Corridor (CPEC).
Major investments in both South Asian countries are in infrastructure and since both countries lack economic, industrial and managerial skills, they have leased such projects to Chinese firms to manage, resulting in more debt to both countries. Had to repay and put them in a vicious circle. Islam Khabar reports that the circle from which they cannot escape.
The new government may have come in Pakistan, but the new government is fighting on many fronts. The previous government of Pakistan Tehreek-e-Insaf has always been blamed by the current rulers for not being able to control inflation while in opposition.
Imran Khan He was ousted from power after losing a no-confidence vote, which he alleged was part of a US-led conspiracy to target him because of his “independent” foreign policy. Even after being removed from his post, the former PM has continued to carry out foreign conspiracies at every rally.
The result is a lack of economic activity, which is driving away modest foreign and domestic investment, but above all, withholding foreign aid. The report said the International Monetary Fund (IMF) is also tightening the noose on Pakistan’s economy before it can issue a USD three billion bailout.
The Sharif government has taken unpopular measures such as raising fuel prices, reducing subsidies and imposing a 10 percent ‘super tax’ on large-scale industries. The dollar exchange rate is PKR 210. All of this has caused inflation to skyrocket at 15 percent.
The country is facing a serious threat on the external front because State Bank Of PakistanThe foreign exchange reserves of India fell in single digits at the end of last month despite an inflow of USD 2.3 billion from China.
“The increasing size of foreign debt servicing each quarter indicates that the government is borrowing dollars at higher commercial rates to meet its foreign debt repayment obligations,” the report said.
Meanwhile, the recent COVID-19 outbreak and heavy rains have affected a large number of homes and lives, adding to the country’s woes.
While the IMF is in no hurry to release USD three billion – Pakistan is projected to need USD 9 billion to USD 12 billion by the end of 2022 – China is also playing its game, noting that the IMF and Beijing is both rivals.
Initially, Beijing had agreed to withdraw syndicated loans before ousting the previous PTI government. However, Sharif’s administration had to wait for two months to secure the Chinese loan.
Since the IMF has apparently slowed down its talks with Pakistan, the country is not getting funding for the project. world Bank and Asian Development Bank.
Governments in fiscal 2012, which ended on 30 June, could not control the inflow of huge imports totaling US$80 billion, creating a large current account deficit (Paddy), which alone is sufficient to understand the external weakness of the economy.
For Pakistan, the comparison to Sri Lanka is unmistakable, both in its excessive reliance on China and its own handling of the economy. Zahid Hussain said, “The Sri Lankan turmoil is a classic example of an economy mired in a dire debt trap while failing to boost its revenues. In fact, political corruption has even contributed to the country’s financial collapse. played the part.”
“Now the IMF is the last hope for a country of 22 million, but aid will not come without harsh conditions that can add to the hardship of the people. In fact, a bailout in itself will not provide a long-term solution, which will help revive the economy. There is a need to undertake fundamental structural reforms for this,” he said.
Meanwhile, analysts said the US government’s current preoccupation with the Ukraine conflict and confrontation with China in the Asian region could only mean imposing harsh terms, both political and monetary, on desperate loan seekers such as Pakistan and Sri Lanka.
“We may not be in Sri Lanka’s shoes yet, but not too far as there are some comparable traits. With talks with International Monetary Fund Obviously inconclusive, and the much-awaited financial aid coming from friendly countries, the country is not in good shape,” journalist and author Zahid Hussain warned daily in Pakistan dawnAccording to a report published in Islam Khabar.
Like China, Sri Lanka is also indebted to China in huge debt and investment. While Sri Lanka has defaulted on repayment and is already in a debt trap, Pakistan ranks second with investments under the China Pakistan Economic Corridor (CPEC).
Major investments in both South Asian countries are in infrastructure and since both countries lack economic, industrial and managerial skills, they have leased such projects to Chinese firms to manage, resulting in more debt to both countries. Had to repay and put them in a vicious circle. Islam Khabar reports that the circle from which they cannot escape.
The new government may have come in Pakistan, but the new government is fighting on many fronts. The previous government of Pakistan Tehreek-e-Insaf has always been blamed by the current rulers for not being able to control inflation while in opposition.
Imran Khan He was ousted from power after losing a no-confidence vote, which he alleged was part of a US-led conspiracy to target him because of his “independent” foreign policy. Even after being removed from his post, the former PM has continued to carry out foreign conspiracies at every rally.
The result is a lack of economic activity, which is driving away modest foreign and domestic investment, but above all, withholding foreign aid. The report said the International Monetary Fund (IMF) is also tightening the noose on Pakistan’s economy before it can issue a USD three billion bailout.
The Sharif government has taken unpopular measures such as raising fuel prices, reducing subsidies and imposing a 10 percent ‘super tax’ on large-scale industries. The dollar exchange rate is PKR 210. All of this has caused inflation to skyrocket at 15 percent.
The country is facing a serious threat on the external front because State Bank Of PakistanThe foreign exchange reserves of India fell in single digits at the end of last month despite an inflow of USD 2.3 billion from China.
“The increasing size of foreign debt servicing each quarter indicates that the government is borrowing dollars at higher commercial rates to meet its foreign debt repayment obligations,” the report said.
Meanwhile, the recent COVID-19 outbreak and heavy rains have affected a large number of homes and lives, adding to the country’s woes.
While the IMF is in no hurry to release USD three billion – Pakistan is projected to need USD 9 billion to USD 12 billion by the end of 2022 – China is also playing its game, noting that the IMF and Beijing is both rivals.
Initially, Beijing had agreed to withdraw syndicated loans before ousting the previous PTI government. However, Sharif’s administration had to wait for two months to secure the Chinese loan.
Since the IMF has apparently slowed down its talks with Pakistan, the country is not getting funding for the project. world Bank and Asian Development Bank.
Governments in fiscal 2012, which ended on 30 June, could not control the inflow of huge imports totaling US$80 billion, creating a large current account deficit (Paddy), which alone is sufficient to understand the external weakness of the economy.
For Pakistan, the comparison to Sri Lanka is unmistakable, both in its excessive reliance on China and its own handling of the economy. Zahid Hussain said, “The Sri Lankan turmoil is a classic example of an economy mired in a dire debt trap while failing to boost its revenues. In fact, political corruption has even contributed to the country’s financial collapse. played the part.”
“Now the IMF is the last hope for a country of 22 million, but aid will not come without harsh conditions that can add to the hardship of the people. In fact, a bailout in itself will not provide a long-term solution, which will help revive the economy. There is a need to undertake fundamental structural reforms for this,” he said.
Meanwhile, analysts said the US government’s current preoccupation with the Ukraine conflict and confrontation with China in the Asian region could only mean imposing harsh terms, both political and monetary, on desperate loan seekers such as Pakistan and Sri Lanka.