Economy

Is Finance Minister Ishaq Dar the mascot of Pakistan’s crippled economy?

Pakistan’s Finance Minister Ishaq Dar will have to take much of the blame for the country’s deepening economic crisis. The fourth finance minister to assume office in three years, Dar took charge on September 28 last year when the foreign exchange reserves held by the State Bank of Pakistan were $7.8 billion. In October, the forex reserves were at $8.7 billion But in eight months, they have halved– the latest data released yesterday showed that the forex reserves are now at $4 billion.

Similarly, the inflation rate which was 26.6 per cent in October, has shot up to a record 38 per cent in May—the highest the country has recorded. In the previous month, the inflation rate stood at 36.4 per cent.

Amid the declining economic health, Dar will present the budget next week. Analysts said that the citizens have little hope and that they know that the worst is yet to come.

Dar’s policies have pushed Pakistan into an uncertain terrain. To begin with, the International Monetary Fund, which resumed its financial assistance package after intense negotiations carried out by Dar’s predecessor Miftah Ismail, halted the programme.

The resumption of the loan programme now depends on the budget announcements.

The country’s business captains fear that the budget would have the stamp of the multilateral agency. Besides Dar has not held any face to face consultation meetings with industry representatives and business heads, deviating from an age-old practice—something that has irked the business community even more.

“There is fear that the budget contours could further hurt the economy and push inflation,” a Pakistani citizen living outside the country told India Narrative on condition of anonymity. “Even if the IMF resumes its loan package, the citizens’ plight will not ease and that is not unknown to them,” he said.

Local newspaper Dawn in an article said that Dar’s “mismanagement of the economy over the last eight months proves that he is part of the problem.”

The country which has to make a repayment of about $3.7 billion by the end of this month has foreign exchange reserves barely enough to pay for imports for a few weeks.

“The situation has come to a point where any step taken to stabilise the economy actually exacerbates the crisis,” the newspaper said.

Also read: Iran Pakistan gas pipeline, Islamabad’s $18 billion headache as it faces default

Mahua Venkatesh

Mahua Venkatesh specialises in covering economic trends related to India and the world along with developments in South Asia.

Recent Posts

VINBAX 2024: Vietnam-India bilateral army exercise concludes at Kaushalya Dam

The fifth edition of the historic Indo-Vietnam Joint Field Training Exercise, VINBAX-2024, successfully concluded its…

11 hours ago

India-Russia strengthen defence ties at 22nd Working Group meeting on military technical cooperation

The 22nd meeting of the India-Russia Working Group on Military technical cooperation and defence industry…

12 hours ago

“I want to have strong representation of India at World Nuclear Exhibition 2025”: Sylvie Bermann

Sylvie Bermann, President of the World Nuclear Exhibition expressed confidence in India's nuclear supply chain…

13 hours ago

PoJK: Joint Awami Action Committee protests against government following new ordinance, many injured

Joint Awami Action Committee core member Shaukat Nawaz Mir has condemned the attack of police…

13 hours ago

PM Modi meets 31 world leaders, heads of organisations during his 3-nation foreign visit

Prime Minister Narendra Modi participated in 31 Bilateral Meetings and informal interactions with global leaders…

16 hours ago

India- Australia conduct 11th Indian Air Force-Royal Australian Air Force Air Staff Talks

India and Australia conducted the 11th edition of the Indian Air Force and Royal Australian…

16 hours ago