Pakistan, one of the world’s nuclear power, is the 5th most populated country in the world. Unfortunately, Pakistan is currently experiencing severe economic backlash. Political unrest and currency depreciation have raised concerns in the South Asian nation. Economic experts in this heavily populated country are concerned about the country’s impending insolvency. Foreign exchange reserves are dwindling, inflation is at an all-time high, and the value of the Pakistani rupee has plummeted in recent months. In short, the current economic condition of Pakistan is so unstable and the government has to take some serious and immediate measures to save the country from bankruptcy.
A no-confidence motion against then-Prime Minister Imran Khan was successful in toppling the government in April 2022. The economy suffered during those two months of political unrest, and the effects are still being felt. Pakistan’s new finance minister Miftah Ismail has declared a financial emergency, and the country has instantly barred the import of luxury items. Analysts have suggested that subsidies and tax breaks be phased down and that high taxes be imposed on property ownership. Special taxes on high-end vehicles and real estate are also among the suggestions. Pakistan’s economic situation has deteriorated due to a delayed IMF rescue package and a lack of assistance from friendly countries.
The Pakistani rupee has hit an all-time low versus the US dollar. In financial markets, the price of one US dollar has surpassed 200 Pakistani rupees. Furthermore, the Pakistan Stock Exchange is in free collapse. Overall, Pakistani investors are having a nightmare. Every day, in different towns across Pakistan, former Prime Minister Imran Khan is mobilizing people against the newly established government. He says that the new government was ‘imported,’ and that it was formed as a result of a foreign scheme including the United States. His anti-American stance has gained him widespread support across the country. Hatred of the Pakistan army is on the upswing in the country, with many people believing that the Chief of Army Staff Qamar Javed Bajwa is to blame for the country’s current government’s overthrow.
Who is responsible? The blame game
Despite expert and analyst advice, the new government has been hesitant to eliminate fuel subsidies. Pakistan’s current Prime Minister, Shahbaz Sharif, blames the previous government for the country’s economic woes as the previous government imposed subsidies on petroleum products. Likewise, the previous government used to blame the present government for the inflation. The country’s foreign reserves are dwindling, and the trade deficit has widened. Food inflation is increasing all the time. However, as a result of the IMF’s demands, fuel prices have risen.
At this time, there is no easy solution at all. Some are demanding new elections, but the country’s reserves are not enough that can bring fresh elections. Just hope and pray that the government, opposition, and agencies find some mid-way that can pull the country out of this danger.