Unstable Political circumstances are causing distress to the country’s economy. It seems that hundred days plan which had to make many things happen have gotten a hit back due to the fright of foreign investors in our shaky markets. Till date, foreign exchange reserves of State bank of Pakistan have gone low to a critical point. Fall of home currency is also being the utmost anxiety. Thus, this situation has made the number crunching really tough for financial planners.
We might be offered financial support with some conditionality to lift this stress from our financial market. Internal security of the country is as important as external affairs and our political alliances are. There are many dimensions of this threat to the economy because of which Pakistan Tehreek-e-Insaf will have to play a hard ball as to produce the number of jobs promised and as well as to eradicate poverty. The first and foremost is the internal security of the country which in these ongoing circumstances seems to be unachievable. This can create an atmosphere of distrust for all foreign investors that are impacting the global economy with their well-mounted Businesses.
The international and corelated dimension of this threat is the mutually funded projects, in which CPEC worth $50 billion with China as a strategic partner might make Pakistan think about seeking a bailout from the international monetary fund. This situation has already given a heads up to American leadership and a statement from their State Secretary has been observed according to which US government seems to be very much interested in watching how IMF is going to stipulate this bailout Package.
Let’s not forget that China has turned out to be the strong political ally of Pakistan. Whereas talks with India to strengthen relations on mutually beneficial grounds have badly failed in the initial phase of government’s 100 days plan. India-US relation has already been affected due to the Russia-India deal of Weapons.
An act has been passed by American Congress that any country buying weapons from Russia, Iran, and North Korea will face sanctions from the United States. China and Turkey have also bought defense systems from Russia which clearly defies the US Influence in the region. In United Nation General Assembly, the President of United States of America has clearly said that the United States of America will always help those countries that are its Friend.
So the critical political situation of Asia might also make an impact on state-owned enterprises in Pakistan. However private businesses will also suffer because of this economic crisis until the process of quick reforms in financial sector begins.
In this hour of need, the Asian Development Bank has announced a financial package of $7 Billion to Pakistan as a relief to stabilize economic conditions and also to fulfill development needs. Asian Development Bank is also going to be engaged in education, health, and social security through income support programs in the future to bring prosperity to the people of Pakistan.
The writer is a change agent and manager E-Business Ways. He can be contacted at firstname.lastname@example.org