Finance Minister Ishaq Dar took to Twitter to announce that Pakistan had got a loan for $700 million from the Chinese Development Bank. This may have been good news, and Senator Dar might feel it is an achievement to be boasted of, but it failed to answer the fundamental question of how vto fix the economy, of how the country can be made to escape the debt trap it is in. After all, though the loan is welcome, it will go to debt servicing, with the nearest repayments being of Chinese loans. In a way, therefore, the money coming from China will only go back. Pakistan is thus already doing with China what it does with the rest of the world: borrow from it, so as to keep servicing its debt.
Pakistan may have weathered the immediate crisis, and the Chinese expression of confidence, for that is what it amounts to, was being withheld because China wanted the IMF to release its latest tyranche and restore the stalled programme. Thus the way may be paved for other blenders, like Saudia Arabia, to release the funds they had tied to IMF resumption of its programme. Pakistan needs an analysis of how it got into this position not because anyone is to be blamed or punished, but so as to find a way out of this trap. It is nerve-wracking for the entire nation to have its economic destiny subject to a crisis every now and then. Perhaps it is all the more worrying that these crises, these swoops close to default only for friendly countries and multilateral institutions to come to the rescue, are becoming more frequent and are coming together.
Perhaps the most essential thing, that all political players come together and devise a common programme, that all stakeholders agree on what changes are needed. There will be no point if those out of office try to roil the waters and cause political instability, and those in office insist on having huge cabinets. Such so-called austerity measures as have been taken recently have fallen short of saving the ordinary man from bearing the brunt of these crises in the shape of onerous conditions being applied. Without forming a national consensus on the way forward, it will be impossible for Pakistan to do more than it has done which is to get another loan, nd kick the can downstairs in the hope that future generations will do something about it.
