Aid packages and economy
Prime Minister Imran on Sunday arrived in Abu Dhabi on a day-long visit amid reports that the United Arab Emirates is ready to extend financial assistance to Pakistan. Pakistan is also likely to receive the first tranche of $1 billion under the balance of payments support from Saudi Arabia within the next couple of days, boosting the country's plummeting foreign currency reserves. The money would hopefully reach the State Bank of Pakistan by Monday.
Earlier PM Khan's trip to China last week was aimed at securing an emergency bailout on easy terms so that Pakistan would not be forced into taking a $10-12 billion loan from the IMF on its hard condition. As Pakistan's closest ally, China did not outright refuse its request but it appears as if hopes of the Chinese coming to the rescue were overly optimistic. Following the prime minister's visit to China, the secretaries of commerce, finance and foreign affairs and the State Bank of Pakistan governor all went to the Chinese to seek aid.
They seem to have now returned empty-handed. China has told Pakistan that the best way to raise money is to increase exports. This, of course, was the entire point of the ChinaPakistan Economic Corridor. The increase in Pakistan's import bill necessitated by the purchase of capital goods from China was meant to spark a massive increase in our exports. That has not happened yet, largely because many of the CPEC projects are not yet complete. Lijian Zhao, the deputy head of mission at the Chinese Embassy, has said that China will give Pakistan a financial support package that will be bigger than the one extended by Saudi Arabia. According to him, commercial banks in China are in the process of setting up credit lines for their Pakistani counterparts. Upon his return from China, PM Imran Khan too had said that China had given us a "big" aid package but refused to give any details.
The problem though is that Pakistan needs the money soon as our foreign currency reserves are dwindling and China appears to be dragging its feet. Now Pakistan is standing at a juncture we have to strike a balance between IMF and China and Pakistan should not depend on one source rather it should use both options and aid packages from Saudi Arabia and UAE are also beneficial. With more options open to us, government will be in better position to make better deals otherwise we have to accept their terms.
Many countries have used IMF package and after a period of five or more years these countries have said goodbye to the packages and they become able to stand on their foot but unluckily in Pakistan we hear claims at the beginning of every package that it will be last but when one government's term ends and new govt arrives we see a sorry state of affairs in our national kitty .Therefore it is need of the hour after taking packages PTI govt should work hard to fulfill its economic agenda and meet its goals. It is the economic front which is key standard of the success of any democratic state if we fail on economic front it means we did not perform at all.