Today, Pakistan is facing an economic crisis. The condition is too bad that the government of Pakistan is advising people to reduce tea consumption. Not only in tea, but they also showed some reduction in paper consumption. This shows a sign of Pakistan economic crisis.
In this article, we will talk about Pakistan’s current condition. And also look towards the reasons of this senior.
What’s happening?
Not only Asia but also the world media is covering this issue. Because, strangely, a country with nuclear weapons is requesting its people to reduce their tea intake. It’s been for more than three years, and Pakistan hasn’t exported anything from India. Tea is one of them. Pakistan is the world’s biggest tea importer, it imports tea worth around 600 million dollars. Before the conflict between India and Pakistan, the same import costs about 300 million dollars (literally just half).
Not only tea Pakistan is facing a paper shortage. They advise people that they should shut down shops after 10 pm. Try to work from home on Fridays. Switch off-street lights on alternate days. Government officers should avoid unnecessary abroad flights. Currently, the price of One liter petrol is 180.
Now Pakistan government coffers have less than nine billion dollars in foreign reserves. The debt of Pakistan is one hundred and thirty billion dollars.
Reason behind this Pakistan Economic Crisis?
There is only one reason behind this condition which is debt. Pakistan took too much debt from many organizations and countries. It took a loan from IMF about 22 times. Not only from IMF but also from the Asian Development bank and World Bank. But every nation took a loan from other organizations and countries, so what’s different in Pakistan’s case.
So answer this statement? Let’s understand why a country takes a loan?
A country takes a loan for its country’s development. That debt is then invested in education, skill enhancement, and in the country’s infrastructure.
But in Pakistan’s case, they haven’t focused on any aspect that I mentioned above.
Pakistan invested its debt in military and repayment. They ignored education and skill development. Because of this, a path with which they can enhance their money got blocked. A major part of Pakistan’s budget divides into military and repayments. The illiteracy rate in Pakistan is 48%. To pay their debt, they take more debt. And then they fix into a debt trap.
Why IMF Is Not Helping Again?
But now IMF is not helping Pakistan in this Pakistan Economic Crisis. Because they have a high previous amount? No, the reason is trust. Yes, IMF has a trust issue with Pakistan. So let’s look at an example of why the IMF doesn’t believe in Pakistan.
In 1996 and 1997, Pakistan showed wrong budget deficit figures to IMF. A nation does that to reduce it by 2 billion dollars in order to secure a bail-out fund.
In Last on this Pakistan Economic Crisis
If IMF does not provide help to Pakistan then It will definitely go to China for help. And China will not help reject. And we all witnessed Sri Lanka’s economic crisis. Many reports say that Pakistan may cede Gilgit Baltistan to China to pay off its heightened debts. It’s a little difficult to believe and may the nation will not cede. But maybe it will be their last option.
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