Pakistan and IMF: A universal cure for all diseases

The International Monetary Fund (IMF) and Pakistan have reached a staff-level agreement on the fourth review of the $7-billion Extended Fund Facility (EFF) and the third review of the Resilience and Sustainability Facility (RSF). The agreement, subject to approval by the IMF Executive Board, outlines a set of familiar measures including maintaining tight monetary policy, preserving exchange-rate flexibility, delivering a primary surplus, and reforming energy prices.

However, despite the IMF's interventions over the years, Pakistan continues to face the same challenges with little improvement in productive capacity. The IMF stabilisation programme has managed to prevent default and improve certain indicators, but it has not led to sustainable development. The ongoing cycle of stabilisation and crisis management resembles a continuous application of the same treatment without addressing the root cause of the patient's fever.

The article questions whether the policies being implemented are truly designed for Pakistan's specific economic structure and whether they can lead to long-term growth and development.

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