Our not so friendly, terrorist neighbor Pakistan, seems to be going through a phase of deep economic crisis. Pakistan prime minister Imran Khan has reportedly departed on a desperate tour to Saudi Arabia to attend an investment conference boycotted by other leaders, on account of journalist Jamal Khashoggi’s death at the Saudi consulate in Istanbul, Turkey. The fact that the Pakistan prime minister had to embark for the Saudi conference despite the fact that it is being widely boycotted, goes on to show that political compulsion triggered by a massive economic crisis is making Pakistan do things which it would have otherwise hated to.
Imran Khan told an interview before embarking on the tour that that even he was concerned by Khashoggi’s death but Pakistan cannot afford to skip this event because “we’re desperate” for possible Saudi loans to shore up Pakistan’s economy. Thus, Imran Khan has himself conceded that Pakistan is in a dire economic crunch on account of Pakistan’s desperation for loans. A balance of payment crisis looks large over the Pakistani economy and Imran Khan is expected to somehow save it from a probable breakdown.
It is Khan’s second visit to Saudi Arabia in just over a month, but he did not have much success in securing financial assistance to ward off the dangers of an economic crisis. In an interview to the Middle East Eye he said, “The reason I feel I have to avail myself of this opportunity is because in a country of 210 million people, right now we have the worst debt crisis in our history.” He also made it clear that unless Pakistan gets loans from friendly countries or the International Monetary Fund (IMF), it would not have enough foreign funds in another two or three months to service its debts or pay for its imports. Thus, Pakistan is standing on the verge of a financial crisis and virtual breakdown even as an IMF bailout appears elusive.
Finance minister Asad Umar and commercial minister Abdul Razak Dawood who are accompanying Pakistan prime minister to the Saudi conference also appeared desperate about getting loans on the tour, adding that it “will give a chance to connect with those who are interested in investing in Pakistan”. However, there is no plausible reason why anyone would want to invest in the terrorist country.
Pakistan has already requested IMF to open negotiations for the country’s second potential bailout in five years. However, it will be politically catastrophic for Imran Khan as IMF might impose strict conditions including limiting Pakistan’s vision of an Islamic welfare state. The central bank’s foreign reserves dropped this month to $8.1 billion, a four-year low and barely enough to cover sovereign debt payments due through the end of the year. The current account deficit of Pakistan has hit a whopping $18 billion.
Pakistan is clearly in a fix. As far as its economy is concerned, it is almost done and dusted. The way it has to literally beg before its make believe friends and the IMF shows that its economy is rickety, their desperate pleas for respite are far too loud to ignore. The terrorist nation seems to have created this situation for itself by spending too much on terror factories and caring little for its own economic interests.