ISLAMABAD, Nov 10: Experts on Monday demanded the government to hold a joint open session of the Parliament to develop a national consensus on economic crisis, including the conditionalities of the International Monetary Fund (IMF) to give loan to the country.Speaking at a seminar on ‘Pakistan and IMF: issues and options’ organised by the Sustainable Development Policy Institute (SDPI), they asked the government to curtail expenditures and show economic and social maturity to overcome trust deficient between the rulers and ruled.

Warning against further victimisation of poor and marginalised people under the new IMF loan arrangements, economic analyst Dr Pervez Tahir and Executive Director SDPI Dr Abid Qaiyum Suleri analysed different aspects of current economic crisis and options to get rid of it.

Dr Tahir recommended an open joint session of the Parliament to develop a consensus on country’s economic situation as, he said, domestic economic policies were more important than to seeing international loans and aid alone.

He said the biggest problem of the country was that its expenditures were more than earnings which, he added, can be only overcome through making the defense budget a realistic one and cut in other expenses, including the civil administration expenditures and establishing an effective system of tax revenues.

“The joint Parliament should discuss these matters and the cuts in expenditures be diverted to education, agriculture and health sectors,” he observed.

Analysing the eight years policies of the “general-led authoritarian government”, he deplored that their approach carried an inherent flaw as their policies essentially focused on services sector, especially credit-related services at the cost of agricultural and manufacturing sectors. And the worst part of it was excessive dependency on imports, which badly hurt our economy, he added.

Dr Tahir said the current economic crisis in Pakistan had begun well before the ongoing global economic meltdown and was direct results of military government’s efforts to give itself a human face through political restructuring to win the elections.

Dr Suleri in his detailed presentation on the history of Pakistan-IMF engagement from 1950 to 2008 called upon the government to reduce “trust deficit” and adopt a policy of austerity.

He said leaving IMF was not an option for Pakistan as it had to meet its obligations and conditionalities as its member as well as borrower of this international support arrangement.

“IMF is a steroid to address the balance of payment issues, and Pakistan should get loans from IMF in such a situation,” he added.

He said Pakistan had always taken loans from the IMF on over-optimistic assumptions and unrealistic objectives involving projections in GDP growth, exports, domestic savings and revenues which resulted in diverse side effects of fast and deep reduction in tariffs.

He observed that it were the poor who had been bearing the brunch of all conditionalities, while analysing the Pakistan-IMF engagement over the years involving exchange rate and payments, trade and tariffs, fiscal policies, financing and banking, and programme ownership and involvement of major stakeholders.

Citing Independent Evaluation Office Report 2002 of the IMF, Dr Suleri said political interference in the management of public enterprises, corruption and increased clout of vested interest in public policy making were major stumbling blocks in Pakistan’s appropriate utilisation of IMF loans.

He noted that politics of aid was controlled by the same donors and Pakistan has to accept the cross conditionalities of all if it continues to keep borrowing loans from any of them, including IMF, world bank, friends of Pakistan, G-8 or Saudia Arabia and China.