Pakistan's Hope

Imran Khan’s priority will be to get the economy back on track.

- Anilesh S. Mahajan

PAKISTAN’S ECONOMY is in doldrums” bureaucrats making a beeline for Prime Minister designate Imran Khan’s palatial Islamabad home are initiating conversations with this sentence.

They can hardly be blamed. How else would they describe the economy of a nation that is at the International Monetary Fund’s doorstep for a bailout to avert an ongoing currency crisis? This is the 14th time in the last 40 years that our neighbour has asked the IMF to rescue it and in the last 60 years it has been to the IMF 21 times. This time round, however, it isn’t going to be as easy and Khan knows that only too well.

Khan’s party, Pakistan Tehreek-e-Insaf, emerged as the single largest party in the recently concluded general elections there, and these days is piecing together support from smaller parties and independents to stitch his majority. His party won 115 seats in the lower house with 272 directly elected representatives.

It is expected that by 11 August, he will be able to form the government. In the interim, Khan has asked his confidante, Pakistani entrepreneur Asad Umar – the frontrunner for the finance minister’s job – to get ready to convince the IMF to give Pakistan a $12 billion package – twice as high as the $5.3 billion given in 2013.

India faced a similar situation in the late eighties and early nineties. We did, however, have an advantage – we only needed to move out of a closed economy to an open one, whereas Pakistan needs a complete overhaul.

Khan in his pre-election campaigns promised increased spending on affordable and accessible healthcare, nutrition, school upgradation and expanding the social safety net, where the spending is less than 3 per cent. To achieve this, however, he will have to make sharp cuts in his defence allocations. But given the equations in Pakistan, Khan won't find this easy.