ISLAMABAD: Contrary to its tall claims, the government once again is pondering to contact International Monetary Fund (IMF) to gain loan to resolve fiscal issues.
Sources told that federal government took loans worth Rs 74 billion during the last two months from different banks and overall it took loans of $ 5.4 billion during the running fiscal year while the acquire loan is a record in the history of the country.
The documents revealed that government took over Rs 26.53 billion from Citi bank, AIIB Rs 8.36 billion, IBRD over Rs 450 million, IDA over Rs 6.38 billion, IDB (ST) over Rs 8..91 billion, IFAD over Rs 190 million, CPEC fund over Rs 370 million, China over Rs 10.59 billion, France over Rs 20 million, USA over Rs 1.39 billion, Germany over Rs705 million, Kuwait over Rs136.4 million, United Kingdom over Rs 5.61 billion and overall loans over Rs 74.75 billion during the last two months. Out of the said amount, Rs 8.24 billion is acquired in shape of grant.
On the other hand, the government has to repay $ 1.18 billion additional loans as compared to previous year. The government has to pay $ 750 million to U.S, $ 500 million to China, and $ 650 million to Paris and the international loan is $ 1.55 billion. According to State Bank of Pakistan, the government has to pay $ 1.11 billion on bonds, $ 550 million commercial loans and has an overall $ 83 foreign debt while the national debt is over $ 25 billion.
Sources said that government took loans on a massive level to increase its assets while it has decided to contact IMF to resolve fiscal issues. It is worth to mention that government had claimed that economic policies are robust and there was no need to approach IMF.
Our (Pakistani) psyche concerning monetary affairs was shaped under the Raj when Muslim landowners had to borrow money from Hindus who mostly controlled the business sector. These ‘banyas’ often foreclosed the loan transactions and took over the landowners’ homes and hearths, subjecting them to miserable economic conditions. That is why in our politics today the word loan is used as a bogey to frighten the nation into doing whatever the powers that be want. But the fact of the matter is that no country can survive without borrowing money, including US and Britain, and India also borrows billions of dollars annually. India’s external debt today is 485 billion dollars, and nobody is crying. Thus borrowing is not a crime for as long as the loans do not exceed 110% of GDP, are put to beneficial use and are not misappropriated. The world monetary system is controlled by the US because since 1974 when president Nixon had abolished gold as the world’s reserve standard and replaced it with law of the jungle according to which any country that had the mightiest fighting power would have its currency act as the world reserve currency. Pakistan is under subtle economic sanctions since its nuclear explosions and any attempt by it to build its economy is thwarted by the superpowers. Thus the pressure against Pakistan has increased manifold since the Chinese proposed CPEC, and even the Chinese are being threatened, as is clear from the recent death threats to the Chinese ambassador.