Pakistan must be in an "economically viable position," according to the US: State Dept.

 Pakistan must be in an "economically viable position," according to the US: State Dept.

According to US State Department spokesperson Ned Price, Washington wants to see Pakistan in "an economically sustainable position," and the US administration is debating Pakistan's macroeconomic stability. In answer to a query about Pakistan's lack of foreign exchange reserves and ways to stabilise its economy, the statement was made at the briefing on Wednesday.

The International Monetary Fund's (IMF) conditions are proving to be a bitter pill for the administration, but there is no other option other than implementing the reforms required by the lender of last resort. Depleting foreign exchange reserves and a worsening political crisis has placed the Shehbaz Sharif-led government in a difficult position. He added, "The Department of State and our colleagues, including the White House and the Treasury Department, regularly discuss Pakistan's macroeconomic stability.

The official continued by saying that the US is "attentive" to Pakistan's economic difficulties and is aware of its cooperation with the IMF and other multilateral creditors. The US, he added, supports Pakistan wherever it can, but the major participants in the relief negotiations are the government in Islamabad and the international financial institutions. The official went on to say that technical challenges "frequently do entail" in the negotiations between Pakistani authorities and the US Treasury department.

 It should be noted that the US government and other friendly countries have urged Pakistan to implement the reforms desired by the international institutions to achieve economic growth and have linked financial assistance with the revival of the IMF programme which has been stalled since September 2022.

 

Government prepared for "difficult decisions"

PM Shehbaz expressed a wish to finish the bailout programme earlier this month during a telephone conversation with the head of the IMF, but little progress has been accomplished so far. In a similar event, the government has now made the choice to resurrect the IMF credit programme by making "difficult decisions."

 

The difficult choices include raising the prices for gas and electricity and announcing a mini-budget that would introduce additional taxing measures in an effort to raise Rs150-200 billion.

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