Experts blame Pakistan’s financial woes on political and economic mismanagement despite multiple IMF bailouts

A security guard stands outside a currency exchange shop in Rawalpindi on July 15, 2023. (AFP/File)
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Updated 19 July 2023
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Experts blame Pakistan’s financial woes on political and economic mismanagement despite multiple IMF bailouts

  • Pakistan has availed 23 IMF bailout programs since 1958, but all of them failed to stabilize the South Asian economy 
  • The successive Pakistani governments have failed to complete the programs, except the one completed in 2013-2016 

KARACHI: The absence of political will and the inability to implement necessary structural reforms are the primary factors that have failed Pakistan in its quest to achieve economic stability, economists say, despite financial assistance from the International Monetary Fund (IMF) on multiple occasions over the decades. 

The South Asian country last month signed a $3 billion Standby Arrangement (SBA) with the IMF making it the 23rd such deal with the global lender since 1958 when the country sought its first $25 million bailout, though the funds were not ultimately withdrawn, according to the IMF data. 

Despite having a long history of reaching out to the IMF for financial assistance, the successive Pakistani governments have failed to complete the programs, except the one completed in 2013-2016, and set a direction for the country to attain economic stability. 

Asked about the failures of the successive administrations in ending the country’s financial woes, Pakistani economists pointed to the politically weak governments and easy access to the IMF as the key factors that contributed to the economic failure. 

“The first reason is that you have not completed any structural reform program of the IMF that we agreed with the Fund, so the problem lies with us,” Dr. Vaqar Ahmed, joint executive director at the Islamabad-based Sustainable Development Policy Institute (SDPI), told Arab News on Tuesday. 

“The second reason is that we lack political will and consistency that is required to implement the structural reforms. The third is the inability of the civil service to implement the reforms.” 

The expert noted that no Pakistani prime minister had ever completed their tenure, neither there were consistent policies in the country since its formation in 1947, which was vital to the continuation of structural reforms. 

“Political cycle is short in Pakistan and these reforms, for example, in the energy sector need 10-15 years to be fully implemented, but the horizon of any government is not that longer,” Ahmed said. 

When governments raise power tariff, they can’t withstand the public backlash and they eventually pull back the reforms, he added. 

Some economists, however, believe the IMF does not have the remedy for the economic ills of Pakistan. 

“It is the problem we have created and we can solve it with determination,” said Dr. Ashfaque Hassan Khan, a senior economist. “IMF will not solve our fundamental problems.” 

Asked why governments preferred IMF bailouts if the lender could not resolve Pakistan’s woes, the veteran economist said there were two contributing factors that forced the governments to repeatedly approach the IMF. 

“One is push and the other is pull factor,” Khan said, explaining the pull factor was from the IMF side to bring Pakistan into an IMF program, while the push factor involved people “strategically placed” within the country. 

“These people employ fear tactics to compel prime ministers to seek assistance from the IMF, citing concerns about market instability and claiming the country would face severe consequences.” 

Pakistan does not need the IMF for economic reforms as the fundament responsibility for this lies with the Pakistani policymakers, according to Khan. 

“If we need to increase revenue, will we wait for the IMF to tell us? Similarly, if we have to rationalize our expenditures and curb our unnecessary imports, do we need IMF to tell us,” Khan asked. 

“We are responsible for our economic problems and we can resolve them, but we are not doing this as we look for easy ways out.” 

Political parties, according to Khan, also lack economic experts that adds to problems on the economic front. 

Dr. Farukh Saleem, a financial analyst and former government spokesman, believed that putting the economy on the track was not a mandate of the IMF. 

“It is not the mandate of the IMF to put the economy of any country on the track. It is the responsibility of the government of that country and its policymakers,” Saleem said. 

“Whatever IMF says, that is in the interest of Pakistan. The IMF is sometimes scapegoated here. When they (governments) raise electricity or gas rates they say they are doing it on the demand of the IMF.” 

But the fact was the IMF didn’t ask to raise power or gas tariffs, but it insisted on selling electricity at a price that was compatible with its cost and it discouraged subsidies, he said. 

Saleem stressed the need to restructure the energy sector and to address the budget deficit, which he said germinated other ills. 

The economists agreed the country needed a charter of economy with a long-term legal cover. 

“Pick up three sectors for reforms such as taxation, energy and state-owned enterprises (SOEs) and draw action plan for next 15 years that should be backed by a legislative cover ensuring that nobody will disturb the plan,” Ahmed suggested. 


India-Pakistan conflict hits shared love of film, music

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India-Pakistan conflict hits shared love of film, music

  • India and Pakistan banned artists, YouTube channels from each other’s countries after their militaries fought in May 
  • While Bollywood movies have always been popular in Pakistan, Indians love music, drama serials produced by Pakistan

LAHORE: While conflict raged between the powerful militaries of India and Pakistan, a battle was also fought on the cultural front lines despite years of shared love for films and music.

The deadly fighting in early May — the worst in decades — affected artists previously untouched by animosity between their leaders.

Ali Gul Pir, a Pakistani rapper and comedian with a huge Indian following, released a song years ago mocking Indian Prime Minister Narendra Modi.

While he was spared consequences then, in May, his YouTube channel and Instagram profile were blocked in India.

“Indians now recognize that the digital space serves as a bridge between Pakistanis and Indians, and they seem intent on severing that connection,” Pir told AFP.

In this photograph taken on June 17, 2025, a man looks at a film poster, Love Guru, featuring Pakistani actress Mahira Khan, outside a cineplex in Lahore. (AFP)

The collapse in bilateral relations was caused by a deadly April attack on tourists in India-administered Kashmir, which New Delhi blamed on Islamabad.

Pakistan denied the allegation and, after tit-for-tat diplomatic retaliation, their militaries fought for four days before a ceasefire was reached.

The conflict hit the music industry for the first time, with Pakistani singer Annural Khalid also remembering how her Indian following dropped off.

“Delhi was my top listening city before the ban,” said Khalid, who has 3.1 million monthly listeners on Spotify.

“I suffered a great loss in the audience” from India, she told AFP.

“Listeners were deprived of content because music was turned into something it is not,” Khalid added.

In this photograph taken on May 29, 2025, Pakistan's pop singer Annural Khalid sings inside her studio in Lahore. While conflict raged between the powerful militaries of India and Pakistan, a battle was also fought on the cultural front lines despite years of shared love for films and music. (AFP)

The conflict also scrubbed out some prior exchanges, such as the soundtrack of the 2017 film “Raees” on Spotify in India.

It now shows only Indian actor Shah Rukh Khan, without his Pakistani co-star Mahira Khan.

With Pakistan producing just a handful of movies each year under strict censorship rules, Bollywood has always proven popular among viewers.

“I grew up watching Bollywood. We have the same traumas, we have the same history, we have the same stories,” said Pakistani film critic Sajeer Shaikh.

In this photograph taken on May 23, 2025, Sajeer Shaikh, a Pakistani film critic and content creator, speaks with AFP during an interview in Karachi. (AFP)

Pakistani actors and directors have for decades seen making it to Bollywood as the ultimate recognition.

Indian Bollywood film actresses Sonam Kapoor (C) and Kirron Kher (L), and Pakistani actor Fawad Afzal Khan (2L) watch the daily retreat ceremony performed by Pakistani Rangers and Indian Border Security Force (BSF) personnel at India-Pakistan Border Wagah Post on September 17, 2014. (AFP/File)

But this month, Indian star Diljit Dosanjh announced his latest movie, “Sardaar Ji 3,” which features four Pakistani actors, would be released “overseas only,” after New Delhi banned Pakistani content and artists from productions.

“Abir Gulaal,” a love story starring Pakistan’s Fawad Khan and Indian actor Vaani Kapoor, was scheduled to hit Indian cinemas on May 9 but the release was postponed.

Even some in the industry who had previously backed the cross-border artistic trade changed their tune last month.

“Everything should be banned... cricket, films, everything,” said Indian actor Suniel Shetty, who has a big fan following in Pakistan.

In this photograph taken on June 17, 2025, a young boy walks past a film poster, Love Guru, featuring Pakistani actress Mahira Khan, inside a cineplex in Lahore. (AFP)

He starred in the 2004 movie “Main Hoon Na,” which subtly promotes peace between India and Pakistan.

“It’s something really unfortunate about politics, creating that rift and putting boundaries around art,” said Dua Zahra, assistant manager at Warner Bros South Asia’s music label in Pakistan.

As part of its measures in the wake of the Kashmir attack, New Delhi’s ban on some Pakistani YouTube channels included private broadcaster HUM TV.

The channel, which says around 40 percent of its viewers are from India, simply told its fans to use a VPN to continue watching.

Since Modi took office more than a decade ago, many Indian critics and filmmakers have warned that Bollywood is now increasingly promoting his government’s Hindu nationalist ideology.

While the conflict has created divisions on the cultural scene, there are signs that the trade will endure.

Over a month after the ceasefire, three Indian films were in the top 10 on Netflix Pakistan, while the top 20 trending songs in India included two Pakistani tracks.
Pir, the rapper and comedian, vowed to “bridge gaps.”

“Let’s not make war, let’s just make art,” he said.

“Let’s just not bomb each other.”


Pakistan urges India to abide by Indus Waters Treaty after world court’s supplemental award

Updated 47 min 25 sec ago
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Pakistan urges India to abide by Indus Waters Treaty after world court’s supplemental award

  • The court ruled that India’s decision of suspending the treaty didn’t affect its competence to adjudicate Pakistan’s complaints
  • The South Asian neighbors have been arguing over hydroelectric projects on the shared Indus river and tributaries for decades

ISLAMABAD: Pakistan on Monday urged India to restore the Indus Waters Treaty (IWT), which ensures water for 80 percent Pakistani farms, and fulfil its obligations, days after the Permanent Court of Arbitration (PCA) announced a supplemental award on the proceedings instituted by Pakistan against India over Indus waters.

India announced it was putting the 1960 World Bank-mediated treaty in abeyance a day after an attack in Indian-administered Kashmir that New Delhi blamed on Pakistan, an allegation Islamabad denies. Pakistan has previously said the treaty has no provision for one side to unilaterally pull back and that any blocking of river water flowing to Pakistan will be considered “an act of war.”

In its supplemental award on the proceedings instituted by Pakistan against India over two hydroelectric projects, the court ruled on June 27 that India’s decision of holding the IWT in abeyance did not deprive the court of its competence to adjudicate Pakistan’s complaints against its neighbor. Pakistan has opposed some of hydroelectric projects by India, saying they violate the World Bank-mediated treaty on the sharing of the Indus waters.

In response to the supplemental award announced by the Court of Arbitration, Pakistan’s Foreign Office said the court found hearing the Pakistan-India dispute over Kishenganga and Ratle hydroelectric projects found that it has a continuing responsibility to advance these proceedings in a timely, efficient and fair manner.

“The Court of Arbitration decided to announce this supplemental award in the wake of India’s illegal and unilateral announcement to hold the Indus Waters Treaty in abeyance,” the Pakistani Foreign Office said in a statement.

“The award vindicates Pakistan’s position that the Indus Waters Treaty remains valid and operational, and that India has no right to take a unilateral action about it. We urge India to immediately resume the normal functioning of the Indus Waters Treaty, and fulfil its treaty obligations, wholly and faithfully.”

Last week, the PCA said it had previously found that once a proceeding before a court of arbitration is properly initiated, as in the present case, “there must be a strong presumption against the incidental loss of jurisdiction over the matters placed before it by subsequent acts, such as the appointment of a neutral expert.”

Weeks after India’s suspension of the treaty, the court issued a procedural order on May 16 and requested the parties to provide written submissions on the effect, if any, of these recent developments before the court.

Pakistan filed written submissions and no submissions were filed by India, but the court said it had considered New Delhi’s position.

“The current phase of the proceedings before the Court concerns the overall interpretation and application of the Treaty’s provisions on hydro-electric project design and operation, as well as the legal effect of past decisions of dispute resolution bodies under the Treaty,” it said.

“Accordingly, the text of the Treaty, read in light of its object and purpose, does not to allow either Party, acting unilaterally, to hold in abeyance or suspend an ongoing dispute settlement process.”

Under the IWT, India has been given the right to generate hydroelectricity through run-of-the-river projects on the western rivers subject to specific criteria for design and operation. The pact also gives the right to Pakistan to raise objections to designs of Indian hydroelectric projects on the western rivers.

On July 6, 2023, the PCA had issued its award on competence after considering India’s objections. In a unanimous decision, the court had ruled that it was competent to consider and determine the disputes set forth in

Pakistan’s request for arbitration in the case. Pakistan had initiated the present arbitral proceedings before the court on August 19, 2016.

The South Asian neighbors have been arguing over hydroelectric projects on the shared Indus river and its tributaries for decades, with Pakistan complaining that India’s planned hydropower dams will cut flows on the river, which feeds 80 percent of its irrigated agriculture.

The PCA noted on Friday that the principal issue concerned the implications, if any, that India’s decision to hold the treaty in “abeyance” may have on the competence of the court.

“Paragraph 16 of Annexure G to the Treaty provides that ‘[s]ubject to the provisions of this Treaty and except as the Parties may otherwise agree, the Court shall decide all questions relating to its competence’,” the PCA said.

“Accordingly, the Court found that it was for the Court — and the Court alone — to answer the question before it.”

New Delhi’s halting of the water agreement was one of a series of tit-for-tat diplomatic measures taken by both countries in the immediate aftermath of the April 22 attack in Kashmir, which resulted in a four-day military conflict between the neighbors in May.


Pakistan vows to continue teamwork, coordination with Saudi Arabia for Hajj 2026

Updated 30 June 2025
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Pakistan vows to continue teamwork, coordination with Saudi Arabia for Hajj 2026

  • Pakistan sent over 115,000 Hajj pilgrims under both government and private schemes to Saudi Arabia this year
  • Saudi Hajj ministry praises “exceptional” measures undertaken by Pakistan for its pilgrims, says Pakistani religion ministry

ISLAMABAD: Pakistan’s Hajj mission met a high-level Saudi Ministry of Hajj and Umrah delegation on Monday to discuss the successful completion of this year’s pilgrimage, the Pakistani religion ministry said, vowing to continue the same spirit of teamwork and service for Hajj 2026. 

This year’s Hajj pilgrimage took place from June 4 to June 9, drawing millions of worshippers to Islam’s holiest sites in Saudi Arabia. Pakistan sent more than 115,000 pilgrims under both government and private schemes. Pakistan’s religion ministry said earlier this month that it is finalizing preparations to launch early registration for both private and government Hajj 2026 schemes to streamline the pilgrimage process. 

The Saudi delegation visited the Pakistan Hajj Mission in Makkah to convey their thanks and congratulations on the successful completion of Hajj 2025, Pakistan’s religion ministry said in a statement. The delegation commended the exceptional arrangements and services provided to Pakistani pilgrims, it added. 

The visiting delegation included Dr. Abdulfattah bin Sulaiman Mashat, the deputy minister of Hajj and Umrah, Eyad bin Ahmed Rahbini, assistant deputy minister for Hajj operations and Dr. Badr Muhammad Al-Solami, the director general of Hajj affairs.

“During the meeting, both sides emphasized the importance of continuing the same spirit of service, coordination and teamwork for Hajj 2026, with a shared commitment to enhancing facilities for pilgrims,” Pakistan’s Ministry of Religious Affairs (MoRA) said. 

MoRA said Dr. Mashat praised the Pakistan Hajj Mission for its professional capabilities, sincere efforts and the arrangements it had undertaken for pilgrims. He described the initiatives taken for the service of Pakistani pilgrims as “exemplary and worthy of appreciation.”

Pakistan’s Director General Hajj Abdul Wahab Soomro appreciated the Saudi delegation’s visit. He highlighted the Saudi Hajj ministry’s guidance and cooperation in the smooth execution of Hajj operations, the religion ministry said. 

Soomro presented a commemorative shield to the Saudi delegation as a token of gratitude and goodwill at the end of the meeting, MoRA said.

“The gesture symbolized not only appreciation for their visit but also the hope for continued bilateral cooperation in future Hajj endeavors,” the religion ministry said. 

Pakistan began its post-Hajj flight operations on June 11 with the arrival of a Pakistan International Airlines flight, PK-732, in Islamabad carrying 307 pilgrims. The flights are expected to conclude by July 10.


Superstar Mahira Khan criticizes India’s ban on Pakistani celebrities’ social media accounts

Updated 49 min 21 sec ago
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Superstar Mahira Khan criticizes India’s ban on Pakistani celebrities’ social media accounts

  • India blocked access to social media accounts of Pakistanis following a plunge in relations last month
  • Khan insists she loves her Indian fans, emphasizes role of artists in forging cross-border connections

ISLAMABAD: Pakistani top actor Mahira Khan has spoken out against India’s ban on Pakistani celebrities and social media accounts, calling it a “political game” and emphasizing the role of artists in building cross-border connections.

India banned the social media accounts of Pakistani celebrities and influencers in early May, days before the two nuclear-armed countries took part in their worst military confrontation in decades, trading artillery fire, missile strikes and drone attacks for four days before the US brokered a ceasefire on May 10. 

New Delhi’s measures to ban Pakistan accounts came in response to India’s allegations that Islamabad was involved in an April 22 attack in Indian-administered Kashmir in which 26 were killed. Pakistan denies involvement and has repeatedly called for an international probe.

When asked what she thought about India’s ban, Khan said she had “zero reaction” to it and still loved her fans in India.

“Fans are fans. People are people, they are the public. What does it [have to do] with politics?” the actress told Independent Urdu in an interview. 

“Anyway, it [politics] eventually connects obviously but this is a political game that ‘Okay, we will close this, we will ban this, we will do that.’ I don’t believe in that.”

Khan said she did not believe in banning art, wondering why artists were the first to bear the brunt of “political problems” between nations. 

“It is strange, isn’t it, that a war erupts or there is a political problem, then the first attack, why do we do it on artists? This is something to think about,” the actor asked. 

“Because artists are the people, and art is the thing that connects people. So the first thing is you ban this, that this [art] dies, love, that there is no love.”

Pakistan’s telecommunication authority responded with measures of its own on May 7, announcing it had blocked 16 YouTube channels and 32 websites from India for spreading “anti-Pakistan propaganda” and disseminating false information.

Khan is one of the most popular and highest paid actors from Pakistan and the recipient of several accolades, including seven Lux Style Awards and seven Hum Awards. She has also made a mark in international cinema, most notably in the Bollywood flick ‘Raees’ in which she stared alongside Indian superstar Shah Rukh Khan in 2017.

In addition to acting, Khan promotes social causes such as women’s rights and the refugee crisis and is vocal about issues such as child abuse and sexual harassment. Khan has been a national and global UNICEF Goodwill Ambassador for Afghan refugees in Pakistan in 2019.

While the ceasefire between India and Pakistan persists, tensions continue to simmer as New Delhi says it will continue to hold in abeyance a decades-old water-sharing treaty with Pakistan. The treaty guarantees water access for 80 percent of Pakistan’s farms through three rivers originating in India.


World Bank appoints Bolormaa Amgaabazar as new country director for Pakistan

Updated 30 June 2025
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World Bank appoints Bolormaa Amgaabazar as new country director for Pakistan

  • New director takes helm as World Bank rolls out $40billion decade-long development plan
  • Appointment comes amid economic pressures and calls for deeper reform under IMF loan

KARACHI: The World Bank has appointed Bolormaa Amgaabazar as its new country director for Pakistan, effective tomorrow, Tuesday, succeeding Najy Benhassine who had held the position since 2020.

Amgaabazar’s appointment comes as the World Bank launches a major new 10-year Country Partnership Framework (CPF) with Pakistan, committing up to $40 billion in combined support from its financing arms. The CPF, approved earlier this year, will focus on tackling child stunting, improving education, strengthening climate resilience, and supporting structural reforms to boost private sector-led growth.

“The World Bank and Pakistan have a long-standing partnership that has benefited millions of people over generations,” Amgaabazar said in a statement. 

“I look forward to deepening our engagement with the federal and provincial governments, local institutions, civil society, the private sector, development partners, and other stakeholders.”

A Mongolian national, Amgaabazar joined the World Bank in 2004 and has worked in East Asia and the Pacific, Africa, and Eastern Europe and Central Asia. She previously held leadership roles in the Bank’s offices in the Kyrgyz Republic and, most recently, Indonesia and Timor-Leste. Prior to joining the Bank, she worked in international development in Mongolia and Southeast Asia.

“We will continue to support Pakistan to address some of its most acute development challenges including child stunting, learning poverty, its exceptional exposure to the impacts of climate change, and the sustainability of its energy sector,” Amgaabazar added.

Since the World Bank Group started operating in Pakistan in 1950, the International Bank for Reconstruction and Development, the main lending arm of the Bank, has provided over $48.3 billion in assistance. The International Finance Corporation, which focuses on private sector development, has invested approximately $13 billion to advance private sector‑led solutions, and the Multilateral Investment Guarantee Agency, which offers political risk insurance and credit enhancement to encourage foreign direct investment, has provided $836 million in guarantees. 

The current portfolio for IBRD, IFC and MIGA in Pakistan includes 106 projects and a total commitment of $17 billion.

The country has teetered on the brink of economic crisis for several years and economists and international financial institutions have called for major economic reforms.

Pakistan is currently under a $7 billion International Monetary Fund bailout program, which requires the country to boost government revenues and shore up external sources of financing, much of which comes from loans from China and Gulf nations.