THIS refers to the editorial ‘Security policy unveiled’ (Jan 17) which gives top priority to the economy. In this context, the prime minister recently said the $6 billion International Monetary Fund (IMF) package would be the last such programme.

But rumour going round for some time suggests that all the conditionalities imposed by the IMF and accepted by the government are actually meant for a bigger IMF programme that is being envisaged following the expiry of the stalled programme in September 2022 to manage the precarious balance of payments position.

The gap between dollar inflows and outflows for 2021-22 is now estimated at $28bn after the surge in the import bill, opposed to the earlier projection of $14bn in the budget. For the year 2022-23, the gross financing requirement would not be less than the current year’s revised estimate of $28bn, if not more.

There is no way the government can avoid a second IMF programme without fundamental reforms and ruthless austerity which is nowhere to be seen.

Strangely, the economic planners do not have any plan on the table to shore up the vulnerable external account which would be a step towards avoiding another IMF programme.

It seems that the economic managers are misleading the decision-makers by not sharing the factual position in order to get accolades despite their miserable performance. If the government opts for another IMF package, it would be the first time that a sitting government will have to resort to two programmes during a single five-year term.

One hopes that this does not happen because, among other things, it would be a negation of the recently announced national security policy.

Arshad M. Khawaja
Karachi

Published in Dawn, February 15th, 2022