1. The document discusses Pakistan's relationship and loans from the IMF over several decades, from the late 1940s to 2008. It outlines the various standby agreements and extended funding facilities Pakistan received during different governments.
2. It analyzes the conditionalities of IMF programs and Pakistan's inconsistent implementation, with fiscal targets often missed. While some reforms were made, concessions remained and tax revenues did not increase substantially.
3. The document evaluates both achievements, like increased exports, and failures of IMF programs in Pakistan, such as stagnant tax revenues. It questions whether Pakistan consistently needed IMF assistance or if governments too readily accepted stringent conditions and accumulated more debt.
Impact of IMF loan on Pakistan's economy: In long run and short runAyesha Majid
To keep the balance of payments in check and to meet the financial obligations government of Pakistan has signed 13th bailout with IMF. This bailout has laid several conditions on the Pakistani government including those on taxes and subsidies, government spending, interest rate, foreign exchange rate and Pakistan's borrowing from China.
Whether the program turns to be beneficial or detrimental for the economy depends how the public responds to the measures and how thoughtfully the government implements it.
This document discusses the Foreign policy of Pakistan in detail along with its constituents. Attention is given to the challenges faced by policy makers and the prospects of our policy.
Impact of IMF loan on Pakistan's economy: In long run and short runAyesha Majid
To keep the balance of payments in check and to meet the financial obligations government of Pakistan has signed 13th bailout with IMF. This bailout has laid several conditions on the Pakistani government including those on taxes and subsidies, government spending, interest rate, foreign exchange rate and Pakistan's borrowing from China.
Whether the program turns to be beneficial or detrimental for the economy depends how the public responds to the measures and how thoughtfully the government implements it.
This document discusses the Foreign policy of Pakistan in detail along with its constituents. Attention is given to the challenges faced by policy makers and the prospects of our policy.
The prime objective of a state is to improve the quality of life of its citizens-security of life & property, the standard of living, political empowerment
For this, the state formulates a comprehensive set of interdependent policies. Foreign policy is one such policy formulated to achieve the above objectives by utilizing the foreign relations of a country
This presentation is an attempt to explain how the foreign policy of Pakistan is shaped, history, successes & failures, as well as challenges
Before going further, you are advised to read Part 1 of this series for acquainting yourself with theoretical aspects of foreign policy
Foreign policy of Pakistan in era of bilateralism 1962-1979Shabbir Hussain
Foreign policy of Pakistan in era of bilateralism 1962-1979
1-Defination Of Foreign Policy
2-Transition Phase (1962-1970)
3-Fall Of Dhaka (1970)
4-Bilateralism And Non-Alignment (1972-1979)
Foreign Policy of pakistan
Pakistan has a fiercely independent foreign policy, especially when it comes to issues such as development of nuclear weapons, construction of nuclear reactors, foreign military purchases and other issues that are vital to its national interests. Pakistan has a strategic geo-political location at the corridor of world major maritime oil supply lines, and has close proximity to the resource and oil rich central Asian countries. Pakistan is an important member of the Organisation of Islamic Cooperation (OIC), is ranked by the US as a major non-NATO ally in the war against terrorism, and has a highly disciplined and professional military.
The foreign policy of Pakistan sets out in the way it interacts with foreign nations and to determine its standard of interactions for its organizations, corporations and individual citizens.Backed by the semi-agricultural and semi-industrialized economy, Pakistan is the 42th largest (nominal GDP) and 25th largest (purchasing power) economic power in the world, with a defence budget of $6.98 billion, which accounts for approximately ~0.37% of global military spending. The Foreign Minister of Pakistan is the official charged with state-to-state diplomacy, although the Prime minister maintains an ultimate authority over foreign policy. The state foreign policy includes defining the national interest, as well as the economic interest and strategies chosen both to safeguard that and to achieve its policy goals.Following the general election held on May 2013, Tariq Fatimi and NSA Sartaj Aziz are designated as advisers to the Prime Minister on foreign and strategic policies
Part 6 of the series on the politica economy of Pakistan which examines the global and domestic environment at the time of General Zia's take over,the economic policies pursued by his team during the 1977-88 decade and how these policies affected the process of economic development of Pakistan
The prime objective of a state is to improve the quality of life of its citizens-security of life & property, the standard of living, political empowerment
For this, the state formulates a comprehensive set of interdependent policies. Foreign policy is one such policy formulated to achieve the above objectives by utilizing the foreign relations of a country
This presentation is an attempt to explain how the foreign policy of Pakistan is shaped, history, successes & failures, as well as challenges
Before going further, you are advised to read Part 1 of this series for acquainting yourself with theoretical aspects of foreign policy
Foreign policy of Pakistan in era of bilateralism 1962-1979Shabbir Hussain
Foreign policy of Pakistan in era of bilateralism 1962-1979
1-Defination Of Foreign Policy
2-Transition Phase (1962-1970)
3-Fall Of Dhaka (1970)
4-Bilateralism And Non-Alignment (1972-1979)
Foreign Policy of pakistan
Pakistan has a fiercely independent foreign policy, especially when it comes to issues such as development of nuclear weapons, construction of nuclear reactors, foreign military purchases and other issues that are vital to its national interests. Pakistan has a strategic geo-political location at the corridor of world major maritime oil supply lines, and has close proximity to the resource and oil rich central Asian countries. Pakistan is an important member of the Organisation of Islamic Cooperation (OIC), is ranked by the US as a major non-NATO ally in the war against terrorism, and has a highly disciplined and professional military.
The foreign policy of Pakistan sets out in the way it interacts with foreign nations and to determine its standard of interactions for its organizations, corporations and individual citizens.Backed by the semi-agricultural and semi-industrialized economy, Pakistan is the 42th largest (nominal GDP) and 25th largest (purchasing power) economic power in the world, with a defence budget of $6.98 billion, which accounts for approximately ~0.37% of global military spending. The Foreign Minister of Pakistan is the official charged with state-to-state diplomacy, although the Prime minister maintains an ultimate authority over foreign policy. The state foreign policy includes defining the national interest, as well as the economic interest and strategies chosen both to safeguard that and to achieve its policy goals.Following the general election held on May 2013, Tariq Fatimi and NSA Sartaj Aziz are designated as advisers to the Prime Minister on foreign and strategic policies
Part 6 of the series on the politica economy of Pakistan which examines the global and domestic environment at the time of General Zia's take over,the economic policies pursued by his team during the 1977-88 decade and how these policies affected the process of economic development of Pakistan
I’m a young Pakistani Blogger, Academic Writer, Freelancer, Quaidian & MPhil Scholar, Quote Lover, Co-Founder at Essar Student Fund & Blueprism Academia, belonging from Mehdiabad, Skardu, Gilgit Baltistan, Pakistan.
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Nationalization of financial sector pakistan 1974Umar Farooq Sahi
An analytical presentation on 1974 nationalization of banks and financial instituitions in Pakistan. Draws on primary sources: government and non-governmental sources, including, old economic surveys, books and research papers on the topic. Information about this topic is scarce and an open field for financial-analytical research.
For more explanation of slides, contact at: <i>
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Umer Toor, Hassan Mohi-ud-Din, Aqeel Rana, Waqas Khalique, Sehrish Asghar
Minorities in Pakistan are in trouble. They face double discrimination each day. There is need to eradicate all of these problems so that every one can live equally.
International Monetary System: The International Financial System - Reform of International Monetary Affairs
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This report highlights the reasons for current Currency Devaluation in Pakistan and the background of International Monetary Fund IMF borrowings. The Impact of IMF borrowing on CPEC has also been discussed. Please press like if you find it informative. Thanks
IMF: Analysis of Policy Recommendations after the Global Financial CrisisUNDP Policy Centre
IMF policy recommendations are often criticised for being orthodox, restrictive and prociclycal in their policy recommendations for developing countries. The global financial and economic crisis has led the Fund to publish papers and organize conferences that show some rethinking on these positions. But, to which extent IMF recent willingness to rethinking has led to actual changes in its policy advice to the developing countries?
This new paper by the Brasilia-based International Policy Centre for Inclusive Growth (IPC-IG) analyses recent recommendations given by the IMF to 26 developing countries to assess whether this ‘change’ discourse has been translated into action in the field. Our analysis looked at the recommendations around exchange rate, inflation, fiscal consolidation, employment and social protection policies. It also covers the theoretical debate behind the policies recommended: the underlying arguments, the criticisms received and the IMF’s position.
PERIYAR UNIVERSITY - B.A. ECONOMICS- IV SEMESTER - INTERNATIONAL ECONOMICS - UNIT – V: Evolution, Role and Functions of International Institutions - IMF, IBRD, GATT, WTO and ADB.
Jennifer Schaus and Associates hosts a complimentary webinar series on The FAR in 2024. Join the webinars on Wednesdays and Fridays at noon, eastern.
Recordings are on YouTube and the company website.
https://www.youtube.com/@jenniferschaus/videos
ZGB - The Role of Generative AI in Government transformation.pdfSaeed Al Dhaheri
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Up the Ratios Bylaws - a Comprehensive Process of Our Organizationuptheratios
Up the Ratios is a non-profit organization dedicated to bridging the gap in STEM education for underprivileged students by providing free, high-quality learning opportunities in robotics and other STEM fields. Our mission is to empower the next generation of innovators, thinkers, and problem-solvers by offering a range of educational programs that foster curiosity, creativity, and critical thinking.
At Up the Ratios, we believe that every student, regardless of their socio-economic background, should have access to the tools and knowledge needed to succeed in today's technology-driven world. To achieve this, we host a variety of free classes, workshops, summer camps, and live lectures tailored to students from underserved communities. Our programs are designed to be engaging and hands-on, allowing students to explore the exciting world of robotics and STEM through practical, real-world applications.
Our free classes cover fundamental concepts in robotics, coding, and engineering, providing students with a strong foundation in these critical areas. Through our interactive workshops, students can dive deeper into specific topics, working on projects that challenge them to apply what they've learned and think creatively. Our summer camps offer an immersive experience where students can collaborate on larger projects, develop their teamwork skills, and gain confidence in their abilities.
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This session provides a comprehensive overview of the latest updates to the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (commonly known as the Uniform Guidance) outlined in the 2 CFR 200.
With a focus on the 2024 revisions issued by the Office of Management and Budget (OMB), participants will gain insight into the key changes affecting federal grant recipients. The session will delve into critical regulatory updates, providing attendees with the knowledge and tools necessary to navigate and comply with the evolving landscape of federal grant management.
Learning Objectives:
- Understand the rationale behind the 2024 updates to the Uniform Guidance outlined in 2 CFR 200, and their implications for federal grant recipients.
- Identify the key changes and revisions introduced by the Office of Management and Budget (OMB) in the 2024 edition of 2 CFR 200.
- Gain proficiency in applying the updated regulations to ensure compliance with federal grant requirements and avoid potential audit findings.
- Develop strategies for effectively implementing the new guidelines within the grant management processes of their respective organizations, fostering efficiency and accountability in federal grant administration.
1. 1
Muhammad Mubeen Haider
Degree: BS(CS)
Faculty: Sciences
Course Code: SSH-102
Course Title: Pak-Studies
Department of Human Linguistics And
Social Humanities
University of Agriculture, Faisalabad
2. 2
Sr. No Contents Page No
1 History & Introduction 03
2 Pakistan‐IMF Relations: 05
3 Loans Taken By Pakistan 06
4 Achievements and Failures 10
5 References 12
3. 3
THE IMF AND PAKISTAN
(A Road to Nowhere)
History of IMF
The international Monetary Fund was created in 1944, at Bretton Woods conference to
prevent the kinds of chain reaction in the economic system that caused world currencies
to collapse like in the Great Depression of the 1930s.
IMF started to make service with IBRD (International Bank of Reconstruction and
Development) in 1947. The IMF was created to support orderly international currency
exchanges and to help nations having balance of payment problems through short term
loans of cash.
The IMF is the world’s central organization for international monetary cooperation. With
188 member countries, it is an organization in which almost all of the countries in the
world work together to promote the common good. The IMF’s primary purpose is to
safeguard the stability of the international monetary system the system of exchange
rates and international payments that enables countries (and their citizens) to buy
goods and services from one another. This is essential for achieving sustainable
economic growth and rising living standards.
INTRODUCTION
IMF is an international financial organization comprised of 188 member
countries.
Purposes, as stipulated in its Articles of Agreement, are to Promote international
monetary cooperation.
Facilitate the expansion of international trade
Promote exchange stability and a multilateral system of payments
Make temporary financial resources available to members under “adequate
safeguards”
Reduce the duration and degree of international payments
4. 4
HISTORY OF PAKISTAN’S RELATIONS WITH THE IMF
A history of Pakistan’s relations with the IMF cannot be told without reference to the
complex and changing role played by the United States, especially since the mid‐1980s.
One of the first serious efforts at tax reform was initiated during this period, with the
appointment of a respected administrator, Qamar‐ul Islam at the head of a distinguished
Commission. The commission’s report, in the mid‐1980s,5 correctly identified corruption
and “cheating” as very significant problems that needed to be tackled in order to move
the tax/GDP ratio from a high of 14% towards 20%, for a sustained increase in
investment and growth. But the report was shelved as the inflows from the US peaked
at about the time it was completed.
A decline of US assistance at the end of the 1980s followed the Soviet withdrawal from
Afghanistan, with the consequent reduced strategic importance of Pakistan. There was
a tightening of US sanctions under the Pressler Amendment, aimed at dissuading
Pakistan from pursuing the development of nuclear weapons.6 However, the US
actively supported the IMF programs and World Bank Structural Adjustment Loans that
followed. In Pakistani eyes, the modalities of assistance had changed, and not the
principal sources.
Hence, IMF conditionality, was treated as largely superfluous in a classic example of the
“moral hazard” problem. Despite the restraining influence of the more conservative
members of the IMF Board, successive programs through the 1990s largely failed to
achieve their twin objectives of fiscal consolidation and establishing the autonomy of the
Central Bank. The nuclear explosion in May 1998, led to a cut‐off of bilateral assistance
and tightening of US sanctions. The Fund program in operation also abruptly came to
an end because the expected foreign inflows assumed in the program dried up with the
sanctions. At this stage, Pakistan made it clear that it would default on IMF payments if
the program were not revived, but that it would continue to pay the Fund if the program
was to be renegotiated.7 This episode could be taken as illustrative of the “defensive
lending” incentives on the side of the Fund to continue its support .
5. 5
Pakistan‐IMF Relations:
The record of IMF relations with Pakistan through the decade of the 1990s’, was
reviewed by the Independent Evaluation Office (IEO) of the IMF in 2002 which sought to
answer the question: what accounted for the country’s prolonged use of IMF resources?
Pakistan was one of six countries selected by the Fund’s Independent Evaluation Office
(IEO) as “prolonged users” and its study tried to answer the question: what accounted
for Pakistan’s prolonged use? It noted that programs in the 1989‐99 period suffered
from substantial policy slippages and soon went off‐track…..a large share of the
committed financing was not disbursed”. Even what was disbursed required “relative
generosity” in the granting of waivers, with five of the seven program reviews completed
in the 1990s’ involving the granting of “at least one and generally several waivers” and
all the waivers on quantitative performance criteria being “requested for reasons other
than minor technical deviations or exogenous shocks”. Moreover, the IEO study notes
that “in spite of the many interruptions suffered by IMF supported programs, the
intervals between two disbursements of IMF resources were generally short ‐‐ never
exceeding twelve months over 1991‐99”.
6. 6
Loans Taken by Pakistan
First loan: 1958
Loan cancelled prior to the expiration date, and the entire amount of the loan
went unused
Ayub govt: 2 more standby agreements, both with a duration of 1 year each
Z.A. Bhutto govt.: 4 more standby loans
Prior to the mid-70’s, stabilization and SAP’s did not play a major role in the
management of the economies of the third world.
1980: Pakistan entered into a long-term Extended Fund Facility (EFF) for a
period of 3 years under Gen. Zia
Amount was 3 times the amount lent post 1947
Another long term agreement was signed by the interim govt. after the death of
Zia
When Benazir’s govt. overtook office the very next day, it ratified the already
agreed program
Sharif’s govt. was also bound by the covenants of the agreement
Another agreement signed in 1993
Signed by the interim govt. of Moeen Qureshi, a former WB staff member
Agreed to policy framework paper
Laid the basis for the more comprehensive, long-term agreement made in 1994
Was the GoP initiating the program based on its own needs, or was it imposed
by the WB/IMF members?
BB comes into power for the 2nd time: handed over a pre-prepared, detailed
program to endorse
Signed the extended 3 year facility
Moeen’s govt. was responsible for framing the program and getting it approved
by the IMF; BB’s govt. just ‘stamped’ it.
The only time a democratically elected govt. itself took a loan was Nawaz Sharif’s
second govt (97-99)
A total of 4 agreements made b/w this govt. and the IMF
All 4 agreements suspended or abrogated
7. 7
Nawaz Sharif’s second govt. completed its program or fulfilled the agreement/
commitments to the IMF and WB
Musharaf: Poverty Reduction and Growth Fund (01-04)
Previous governments (88-99) had incomplete implementations but core policy
measures – devaluation, price, exchange rate, interest rate and trade
liberalization; public enterprise reform; and subsidy withdrawal were
implemented however reluctant and slow they may have been in the
implementation
The 2008 Crisis and the “IMF Programme”
Countries only turn to the IMF in times of grave crisis; thus the starting point is invariably
one of extreme volatility and disequilibrium. The decision of the present government to
ask for IMF help in 2008 is a case in point. The economy was in dire straits, rushing
headlong towards bankruptcy and debt-default. Economic growth had slowed, inflation
had reached levels unheard of in Pakistan, the domestic and external deficits had
widened appreciably. Millions of households which the previous government claimed
had been lifted out of poverty fell back. As confidence waned, there was massive capital
flight. The rupee was in virtual free-fall. Rather than take prompt corrective measures to
stem the alarming slide of the economy, the new government pinned its hope on
securing external resources from bilateral donors and friendly countries (Saudi Arabia,
China) including commitments from a new concoction called “Friends of Democratic
Pakistan (FODP). In other words, the authorities were looking around for a “free
lunch”—but there was none forthcoming. The government said they had a “Plan A”, a
“Plan B” and a “Plan C” when it should have been self-evident that the only plan that
would work was “Plan F”, the IMF because no one else would give us any money.
Indeed, all of Pakistan’s bilateral donors (as well as the World Bank and Asian
Development Bank) urged the government to enter into a Fund arrangement as a
precondition of financial support. Even our “friends” balked.
Countries will typically wait in the hope that the economic situation will somehow turn
around and some may even take corrective measures. No country wants to end up at
the IMF doorstep in Washington DC and ask to be bailed out because it means they
have accepted failure and have lost control over the economy. But in waiting so long,
8. 8
the task of halting the downward spiral and the return to a semblance of
macroeconomic stability becomes all the 4 more onerous and difficult with the pain of
adjustment falling disproportionately on the poor and vulnerable who have little or no
social protection. The Pakistani media always makes reference to the “IMF
programme”.
It is not an IMF programme. It is Pakistan’s programme and one that we are, or should
be, fully committed to. “Programme ownership” is a critical ingredient in successful
programme implementation. Without “owning” the programme, it will fail. Pakistan has
typically lacked ownership, especially at the political level. This then translates into
faltering implementation, a sleigh of hand to meet targets, and more grievously a roll-
back of reforms once the programme has either come to an end or, more typically, has
been terminated by the authorities themselves. An example of a roll-back is the removal
of exemptions and concessions as part of programme conditionality. However, once the
programme has been abandoned, these concessions and exemptions are quietly
restored and, no doubt, new ones added, fragmenting the tax base again and leading to
a loss of revenue.
The IMF, as per its mandate, stands ready to assist Pakistan, a member-country in
“good standing”, and with its resources help forestall another chaotic economic
meltdown. But it has thus far refused to provide the government with a “Letter of
Comfort” which is urgently needed to unlock quick-disbursing resources to support the
budget and balance of payments. Many observers think that this hardening of the
Fund’s attitude towards Pakistan reflects the deterioration of Pakistan’s relations with
the United States and all that is needed is a US nod-and-a-wink and lobbying of other
G-7 Executive Directors and the Letter of Comfort will be forthcoming. But, realistically
speaking, any Pakistani economist of worth, or the Fund, would be hard pressed to
declare that Pakistan’s macroeconomic situation is anywhere near “satisfactory and
sustainable”. Such a declaration under the present highly-fraught economic
circumstances would not only require a willing suspension of disbelief but would carry
no credibility at all. And the Fund knows it.
9. 9
Interests of the authorities
Pakistan has an immature political structure, with political parties struggling to replenish
coffers after lengthy periods in the wilderness—especially given long periods of
military‐led rule. The interests of the politicians, seeking funds for reelection, and
perhaps personal gain, and an increasingly rent‐seeking bureaucracy coincided. Holes
in the tax system and preferences in the tariff regime, facilitated by SROs that often
override legislation, are a useful way to “make friends and influence people.” While
paying lip service to IMF conditions to remove such loopholes, including under the
ESAF negotiated by technocratic PM Moeen Qureshi in 1993, the second Benazir
Bhutto administration actually increased the magnitude of such exemptions in its budget
of June 1994, although going through the motions of eliminating some minor provisions.
It is interesting that Musharraf’s selection of a private banker as Finance Minister,
Shaukat Aziz, who was presumably immune to “rent‐seeking” influences, attempted to
cut the Gordian knot by removing entire sectors from the GST (textiles, sports goods,
carpets and leather goods among others—virtually all the productive .
10. 10
Achievements and Failures
Fiscal Policy: implementation was weakest in this area
Tax revenues as a % of GDP remained stagnant
Steps taken in taxation
numerous income and wealth tax exemptions were eliminated
simplification and rationalization of the tax structure
Attempts to improve tax administration
Actual results?
Number of tax payers and coverage remained low
121 commodity categories exempt from the GST, so
progress in reducing concessions remained limited
Exports increased sharply (11.5% p.a.)
Resident Pakistani’s were allowed to open foreign currency
accounts in Pakistan (frozen in 1998)
Banks were authorized to increase interest rates on deposits
MCB and ABL were sold to the private sector
10 new private sector commercial banks and 8 investment
banks were sanctioned
Increased activity and capitalization in the stock market
Rate of return on T-bills increased from 6 to 13%
11. 11
Did Pakistan need to go to the IMF?
Inflation rate: 11,000%
Fiscal deficit in excess of 30% of GDP
GDP per capita was 20% less than that in 1980
Pakistan has never been in such critical conditions, though it
may have gotten there on account of following these programs!
While Pakistan’s economy needs better management, reform
and alignment, does it need to run to the IMF every 3 years?
Why does each govt. accept the stringent conditions, more
loans and more debt?