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HomeWorldWith IMF not amused, Shehbaz pushes austerity to avert economic tsunami

With IMF not amused, Shehbaz pushes austerity to avert economic tsunami

After being widely criticised for plunging the masses into a dangerous wave of inflation, price hikes and taxes, Prime Minister Shehbaz Sharif-led Pakistan coalition government has now come up with an austerity plan to avert the economic meltdown aiming to save the government over Rs 200 billion per annum. 

In a latest, Prime Minister Shehbaz Sharif has asked all of his ministers and advisers to relinquish their salaries, benefits and luxury cars and to fly economy class to help the government save millions of rupees to avert the loomimng economic meltdown threats the country is facing. 

The step comes amid the Shehbaz Sharif government doing anything and everything to resume the stalled Extended Funding Programme (EFF) of the International Monetary Fund (IMF) to secure funds worth $1.1 billion, which will be provided after approval of the ninth review of the IMF plan for Pakistan. 

“The IMF deal settlement and resumption is in its final stages. We have had to impose new taxes, introduce mini-budget and increase prices to meet their demands. This has been done with a very heavy heart because this deal was not done by our government. It was done by Imran Khan and we are now forced to comply with it and fulfil all of its shortcomings,” said Shehbaz Sharif while announcing the government’s austerity plan. 

It is in the same line that fresh austerity drive to cut expenditures is being introduced to stave off an economic meltdown and meet the country’s balance of payments crisis. This comes at a time when Pakistan’s central bank, the State Bank of Pakistan’s foreign exchange reserves are already reeling before a three-week import cover, while the inflation maintains its consistency at high levels. 

“Far-reaching results of these measures will come to the fore. We will save around Rs 200 billion due to such measures. Although these measures would not give any significant relief to already inflation-hit people, they would give them a sense that the government realised their pain and agony,” said premier Shehbaz Sharif. 

As per the austerity plan, the size of the cabinet will be reduced, which currently is one of the biggest in the country’s history with 85 members, which includes 34 federal ministers, seven ministers of state, four advisors and at least 40 special assistants to the Prime Minister. 

It has also been decided that all federal cabinet ministers, advisers and special assistants would not take salaries and will also pay their utility bills from their own pockets. Moreover, the members will also return all luxury vehicles, which would later be auctioned and that the members would fly in economy class air tickets during their domestic and foreign trips, during which, assisting staff will no longer be accompanying them. 

All government offices would be opened at 7:30 a.m. to save electricity and gas, while import of luxury items and official vehicles will be banned, a government official would be able to own only one official plot, foreign visits will be filtered and minimised and online zoom meetings will be preferred, cabinet members would not stay in 5-star hotels, big houses allotted to government officials will be recovered and sold, and the government will also implement a 15 per cent cut in expenses of government institutions, while the armed forces will also reduce non-combat expenditures. 

Shehbaz Sharif also called on the Chief Justice of Pakistan (CJP), Chief Justices of High Courts and other courts of all provinces, chief ministers of provinces to implement similar measures to help the country come out of its prevailing economic crisis. 

It is pertinent to mention that the latest austerity measures announced by the government do not have a very positive history of implementation in the past. The government earlier announced similar measures for market closure timings and other steps, which were notified but were not implemented. 

However, this time, the government seems resolute to ensure implementation of its directives to help the country avoid a financial and economic meltdown.

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