LONDON: Negotiations on a new government in Pakistan have allayed immediate fears of instability in the nuclear-armed nation following inconclusive elections last week, but the risk of a full-scale economic crisis remains.
A $3 billion program from the International Monetary Fund (IMF) runs out next month and securing a new and much bigger one is widely seen as the priority for the new administration.
WHO COULD THE IMF NEGOTIATE WITH?
The largest party, the Pakistan Muslim League-Nawaz (PML-N), secured support on Tuesday from the second biggest, the Pakistan People’s Party (PPP), and is trying to persuade it to form a majority coalition.
The caretaker government in place since August is implementing the IMF loan program which helped to avert a sovereign debt default when it was approved in July. Recent legislation allows it to make decisions on economic matters in the South Asian country as well as overseeing the election. It did not immediately respond to a request for comment on the prospects for a new IMF deal.
HOW BAD IS THE ECONOMIC SITUATION?
Pakistan’s foreign exchange reserves stand at roughly $8 billion which barely covers two months of essential imports although it is an improvement from the $3.1 billion they were down to just over a year ago.
A $1 billion bond payment in two months’ time will cut them further although the country is getting a $700 mln injection of already-approved IMF money too.
“It is imperative (to get into another IMF program), given that Pakistan’s foreign exchange reserves are abysmally low compared to its large impending external debt repayment needs. Former deputy central bank governor Murtaza Syed said. “There is no alternative.”
HOW MUCH DEBT IS THERE?
Pakistan’s debt-to-GDP ratio is already above 70 percent and the IMF and credit ratings agencies estimate that the interest payments on its debt will soak up 50 percent and 60 percent of the government’s revenues this year. That is the worst ratio of any sizable economy in the world.
Analyst firm Tellimer says the country’s problem is primarily domestic debt, which comprises around 60 percent of its debt stock and 85 percent of its interest burden. Pakistan’s external debt stock — denominated largely in dollars — is also heavily skewed toward bilateral and multilateral creditors, which comprise roughly 85 percent of the total.
Bonded debt comprises just 8 percent of the external debt stock and 3.4 percent of its total public debt. That is dwarfed by the near 13 percent of total debt that it owes to China which has lent to Pakistan money over the years for infrastructure projects and for other types of spending.
HOW IS IT AFFECTING THE POPULATION?
A combination of tax and gas tariff hikes and a steep fall in the rupee currency have pushed inflation up to nearly 30 percent year-on-year. It is expected to come down later in the year but will stay well above the central bank’s 5-7 percent target for some time, economists forecast.
The rupee is expected to fall further too. For context, the implied exchange rate underlying the latest IMF staff report is 305 rupee to the dollar for this fiscal year and 331 per dollar in FY 24/25, levels which are roughly 8 percent and 15 percent weaker than the current exchange rate.
How bad is Pakistan’s debt crisis and can the IMF save it?
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How bad is Pakistan’s debt crisis and can the IMF save it?
- Pakistan’s foreign exchange reserves stand at roughly $8 billion which barely covers two months of essential imports
- Country’s problem is primarily domestic debt, which comprises around 60 percent of its debt stock and 85 percent of its interest burden
Pakistan arrests woman among two more human smugglers after deadly Greek shipwreck
- The boat capsize near the Greek island of Gavdos killed at least five Pakistani nationals this month
- The arrests come days after Pakistan PM Shehbaz Sharif ordered a crackdown on human smugglers
ISLAMABAD: Pakistani authorities have arrested a woman among two more human smugglers after a recent boat tragedy off the coast of Greece that killed at least five Pakistanis, the Federal Investigation Agency (FIA) said on Thursday, an intensified crackdown on human smuggling networks.
The arrests come in the wake of the boat capsize this month near the Greek island of Gavdos, which highlighted the perilous journeys many migrants undertake, often driven by conflicts in the Middle East. In the case of Pakistani nationals, economic challenges push many young individuals to attempt dangerous crossings to Europe in search of better financial prospects.
The issue of illegal immigration to Europe came under greater scrutiny in the South Asian country last year when hundreds of migrants, including 262 Pakistanis, who were en route to Greece from Libya, drowned after an overcrowded vessel capsized off the southwestern Greek coastal town of Pylos.
On Thursday, the FIA said it had apprehended suspects, Isha Fatima and Abdullah Shehzad, who were involved in both incidents, in Gujranwala city of Pakistan’s most populous Punjab province, while the agency was conducting raids for the arrest of other human smugglers.
“Female human trafficker Isha Fatima is involved in the Greek boat accident, while proclaimed offender Abdullah Shahzad is involved in the Libya boat accident that occurred in 2023,” it said in a statement.
“Isha Fatima, with the connivance of other accomplices, trafficked one of the Pakistanis from Libya to Greece via boat. The Pakistani national was rescued in the Greek boat accident [this month].”
The woman suspect had received Rs4.5 million ($16,189) from the survivor, according to the investigation agency. The other suspect, Shehzad, had been involved in the 2023 incident that killed more than 250 Pakistani nationals. He had taken Rs2.9 million ($10,433) from each victim for sending them abroad.
The development came days after the FIA said it had apprehended two suspects in Punjab’s Gujranwala and Gujrat, who were involved in this month’s boat capsize.
Pakistan’s Prime Minister Shehbaz Sharif this month called for enhanced cooperation with international agencies, seeking swift action against human trafficking networks. He also instructed the FIA to compile a detailed report on migration-related incidents over the past year and implement an Integrated Border Management System (IBMS) to monitor and prevent illegal movement.
“A crackdown on elements involved in the Greek boat tragedy is underway. All resources are being utilized to arrest the suspects,” Abdul Qadir Qamar, FIA Gujranwala zone director, said on Thursday.
“In the light of solid evidence, the accused will be handed down stern punishment.”
Pakistan vows to extend ‘practical support’ to rehabilitate Palestinian educational institutions
- At least 625,000 children have been denied entire year of school due to Israel’s war on Gaza, says UNICEF
- Pakistan and COMSTECH have partnered to provide fully funded scholarships for hundreds of Palestinians
ISLAMABAD: Pakistan’s Education Minister Dr. Khalid Maqbool Siddiqui on Thursday vowed to extend “practical support” to rehabilitate educational institutions in Palestine, the OIC’s Standing Committee on Scientific and Technological Cooperation (COMSTECH) said.
Israel’s military campaigns in Gaza since Oct. 7, 2023, have killed over 44,000 Palestinians. Israel’s bombardment has dealt a heavy setback for education in the area, and according to a report by UNICEF, 625,000 children have been denied an entire school year in Gaza. With the conflict still ongoing, they face the high risk of a second year without education.
COMSTECH, in collaboration with the Association of Private Sector Universities of Pakistan (APSUP), initiated a program in 2021 offering 500 fully funded scholarships and fellowships to Palestinian students. This number was increased to 5,000 scholarships in 2023. Many Palestinian students have already arrived in Pakistan under this program and are pursuing full-degree programs.
Siddiqui, along with COMSTECH Coordinator General Dr. Muhammad Iqbal Choudhary, visited the Palestinian embassy in Islamabad to discuss matters related to education with Palestinian Ambassador Dr. Zuhair Zaid.
“He [Siddiqui] assured that Pakistan is committed to extending practical support for the rehabilitation of educational institutions in Palestine,” a press release by COMSTECH said.
The Pakistani minister reiterated his government and people’s steadfast support for Palestine, COMSTECH said.
“Sharing insights from his recent visit to Oman, he revealed discussions with educational ministers from other countries about joint actions to assist Palestine in the education sector,” it added.
Siddiqui said he has proposed convening an extraordinary meeting of the education ministers from OIC member countries in Islamabad to devise a “comprehensive long-term plan for supporting Palestine.”
Zaid expressed thanked the government, COMSTECH and people of Pakistan, the OIC body said.
“He acknowledged their steadfast support, emphasizing that these efforts will never be forgotten by the Palestinian people,” the statement said.
Pakistan PM visits Azerbaijan embassy, condoles loss of lives in Kazakhstan plane crash
- At least 38 people were killed when Azerbaijan Airlines passenger plane crashed in Kazakhstan’s Aktau city
- Shehbaz Sharif says ties between Pakistan and Azerbaijan rooted in shared religious and cultural values
ISLAMABAD: Prime Minister Shehbaz Sharif visited Azerbaijan’s embassy in Islamabad on Thursday to condole over the loss of lives in the Azerbaijan Airlines plane crash in Kazakhstan, the Prime Minister’s Office (PMO) said.
At least 38 people were killed when an Azerbaijan Airlines passenger plane with 67 people on board crashed near the Kazakhstan city of Aktau on Wednesday. The Embraer 190 aircraft was en route from the Azerbaijani capital of Baku to the Russian city of Grozny in the North Caucasus.
The Pakistani prime minister visited the Azerbaijan embassy in Islamabad where he met Khazar Farhadov to offer his condolences over the incident.
“In this hour of grief, the government of Pakistan and the people of Pakistan express their complete solidarity with the brothers and sisters of Azerbaijan,” Sharif was quoted as saying by the PMO.
The Pakistani prime minister prayed for the speedy recovery of all injured in the blast.
“Azerbaijan and Pakistan have strong relations of brotherhood based on shared religious and cultural values,” Sharif said.
Pakistan has eyed closer economic cooperation with Central Asian states such as Azerbaijan in recent months as the South Asian nation faces an economic crisis.
During Azerbaijan President Ilham Aliyev’s two-day visit to Pakistan in July, both nations agreed to enhance the volume of bilateral trade to $2 billion, vowing to strengthen ties and increase cooperation in mutually beneficial economic projects.
They also signed the Pakistan-Azerbaijan Preferential Trade Agreement to boost economic cooperation through the reduction of tariffs on goods like Pakistani sports equipment, leather, and pharmaceuticals as well as Azerbaijani oil and gas products.
Pakistan reports two new polio cases as 2024 tally surges to 67
- Pakistan detects poliovirus cases from Kashmore in southern Sindh and Tank in Khyber Pakhtunkhwa provinces
- Efforts to eradicate polio have been undermined by misinformation, opposition from religious hard-liners
KARACHI: Pakistan reported two new polio cases on Thursday, pushing this year’s tally of the infection to 67, the country’s polio eradication program said amid Islamabad’s struggle to contain the spread of the disease.
Pakistan, along with neighboring Afghanistan, remains the last polio-endemic country in the world. The nation’s polio eradication campaign has faced serious problems with a spike in reported cases this year that have prompted officials to review their approach to stopping the crippling disease.
The Regional Reference Laboratory for Polio Eradication at Pakistan’s National Institute of Health confirmed that two wild poliovirus type 1 cases, one each from Tank in northwestern Pakistan and Kashmore in Sindh were reported on Thursday.
“Pakistan is responding to the resurgence of WPV1 this year with 67 cases reported so far,” the Polio Eradication Programme said. “Of these, 27 are from Balochistan, 19 from Khyber Pakhtunkhwa, 19 from Sindh, and one each from Punjab and Islamabad.”
It said that this was the fourth case reported from Tank and second from Kashmore this year.
Pakistani authorities last week conducted a large-scale sub-national polio vaccination campaign in Punjab, Sindh, Khyber Pakhtunkhwa, Azad Jammu and Kashmir, Gilgit-Baltistan and Islamabad, vaccinating over 42 million children.
The second phase of the campaign is scheduled to begin on Dec. 30, covering Balochistan province.
Poliovirus, which can cause crippling paralysis particularly in young children, is incurable and remains a threat to human health as long as it has not been eradicated. Immunization campaigns have succeeded in most countries and have come close in Pakistan, but persistent problems remain.
In the early 1990s, Pakistan reported around 20,000 cases annually but in 2018 the number dropped to eight cases. Six cases were reported in 2023 and only one in 2021.
Pakistan’s polio program began in 1994 but efforts to eradicate the virus have since been undermined by vaccine misinformation and opposition from some religious hard-liners, who say immunization is a foreign ploy to sterilize Muslim children or a cover for Western spies. Militant groups also frequently attack and kill members of polio vaccine teams.
UN calls for investigation into Pakistan’s alleged air strikes on Afghanistan border
- UN mission in Afghanistan says dozens of civilians killed in airstrikes this week by Pakistan in Paktika province
- Islamabad accuses Kabul of harboring militant fighters, allowing them to strike on Pakistani soil with impunity
KABUL: The UN mission to Afghanistan on Thursday called for an investigation into Pakistani air strikes in Afghanistan, in which the Taliban government said 46 people were killed, including civilians.
The United Nations Assistance Mission in Afghanistan (UNAMA) said it had “received credible reports that dozens of civilians, including women and children, were killed in airstrikes by Pakistan’s military forces in Paktika province, Afghanistan, on 24 December.”
“International law obliges military forces to take necessary precautions to prevent civilian harm,” the agency said in a statement, adding an “investigation is needed to ensure accountability.”
The Taliban government said the 46 deceased were mainly women and children, with another six wounded, mostly children.
An AFP journalist saw several wounded children in a hospital in the provincial capital Sharan, including one receiving an IV and another with a bandaged head.
A Pakistan security official told AFP on Wednesday the bombardment had targeted “terrorist hideouts” and killed at least 20 militants, saying claims that “civilians are being harmed are baseless and misleading.”
On a press trip to the area organized by Taliban authorities, AFP journalists saw four mud brick buildings reduced to rubble in three sites around 20-30 kilometers (10-20 miles) from the Pakistan border.
AFP spoke to multiple residents who said the strikes hit in the late evening, breaking doors and windows in villages and destroying homes and an Islamic school.
Several residents reported pulling bodies from the rubble after strikes targeted houses, killing multiple members of the same families.
Afghanistan’s Minister of Borders and Tribal Affairs Noorullah Noori called the attack “a brutal, arrogant invasion.”
“This is unacceptable and won’t be left unanswered,” he said during the site visit.
Pakistani foreign ministry spokesperson Mumtaz Zahra Baloch did not confirm the strikes but told a media briefing on Thursday: “Our security personnel conduct operations in border areas to protect Pakistani from terror groups, including TTP.”
She was referring to the Tehreek-e-Taliban Pakistan (TTP) — Pakistan’s homegrown Taliban group which shares a common ideology with its Afghan counterpart.
The TTP last week claimed a raid on an army outpost near the border with Afghanistan in which Pakistan said 16 soldiers were killed.
Baloch said Pakistan prioritized dialogue with Afghanistan, and that Islamabad’s special envoy, Sadiq Khan, was in Kabul meeting with officials where “matters of security” and “terror groups including TTP” were discussed.
The strikes were the latest spike in hostilities on the frontier between Afghanistan and Pakistan, with border tensions between the two countries escalating since the Taliban government seized power in 2021.
Islamabad has accused Kabul’s authorities of harboring militant fighters, allowing them to strike on Pakistani soil with impunity — allegations Kabul denies.
