The biggest crisis facing Pakistan is the economic crisis. Whether the new Finance Minister, a technocrat, Muhammad Aurangzeb will be able to succeed is yet to be seen.
In his first press conference, Aurangzeb promised to continue with the IMF-mandated stabilisation policies under the $3 billion Stand-by Arrangement. The former banker stated that Pakistan “could no longer afford to continue with a ‘patchwork’ approach to deep-rooted economic woes if it wanted to address the challenge posed by low economic growth and inflation.”
Aurangzeb pointed out that Pakistan needed “to kick-start discussions for a new, larger and longer IMF loan during the international lender’s visit for the second and final review of the current nine-month facility that ends soon.” As of now, the minister’s plan “is a significant departure from the PML-N’s signature economic and financial policies.”
As an editorial in Dawn asked the billion-dollar question? “Will he get enough room to execute the stabilisation policies for as long as it is required? What is the guarantee that the ruling party will support his attempts to effectively tax its core political constituency of retailers or the powerful real estate mafia? Last but not the least, how long will the government resist the temptation of spurring growth without executing the long-standing structural reforms once forex reserves rise to a comfortable level, as it panders to its vote bank?”
