.. by Ahsan Gardezi

Pakistan is the only country in the world where securing a public-financed bailout from the International Monetary Fund (IMF) is considered a “major economic milestone”.

Prime Minister Shehbaz Sharif on Wednesday lauded the successful staff-level agreement with the IMF for a $1.3 billion loan plus $1.3 billion in climate financing. He termed it a “major milestone” in our path towards recovery.

Without offering a lot of facts to support this argument, he said that the agreement would raise Pakistan’s foreign reserves to $8.3 billion and said it was a big achievement.

The prime minister said tax collection had surpassed IMF expectations and reaffirmed the government’s commitment to maintaining the Rs. 12.3 trillion tax target for FY25. He claimed that his team rejected the IMF proposals to lower it during the review talks.

Why don’t we celebrate the $3.1 billion remittances sent by overseas Pakistanis? That is rent-free, tax-free, and corruption-free. In 8MFY25, remittances increased by 32 percent YoY to $24 billion compared to inflows of $18.3 billion reported in 8MFY24.

For what it is worth, the bailout will most definitely be churned out of the taxpaying salaried class and low-income groups (they don’t have to be classified as filers here).

The SLA shouldn’t be considered a measure of success but rather evidence of continued dependency. Instead of real economic progress, the government is lauding a temporary liquidity injection that does nothing to address the structural deficiencies causing Pakistan’s fiscal crisis. If this is an economic milestone, then what do we call sustainable growth, industrial expansion, or rising exports?

Many on social media have called Pakistan one of the world’s biggest ponzi schemes for money controllers to ship dollars. Are they lying? Most commentators on X don’t think so.

And let’s not forget that this IMF bailout, like all its predecessors, will be wasted on interest payments, fiscal management, and inefficiencies rather than genuine economic reforms. The hope is that this program helps authorities rein in stability and reduce dependency on foreign lenders to stay financially afloat.  .. Source