Pakistani Economic Stress Watch

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Atmavik
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Re: Pakistani Economic Stress Watch

Post by Atmavik »

PKR crosses 250 , damn IMF has put a halt to Dar o nomics . Other wise PKR would cross 300 in sehwag style
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Re: Pakistani Economic Stress Watch

Post by chetak »

Avinandan wrote:
Anujan wrote:Pakistan will likely get bailed out.
I am disappointed :x ,what will IMF gain by bailng them out?

On another note, I was astonished that there are far bigger debtors than Pakistan at IMF.
https://www.fdiintelligence.com/content ... tors-81405

it is the amerikis who will gain and that too by using IMF money

the amerikis are not yet finished with India, cashmere, and siachen, (of these, C+S have been promised to the pakis by the amerikis at various times and in some cases, raincoat sardar and the congi mafia are directly complicit) also, they need the "snakes in the backyard" to be bred by the pakis, so that there is plausible deniability.

The culinary institute was never ever mistaken to be a charitable organisation

Out of the two and a half fronts, who do you think is primarily supporting the half front operating in India

no matter who replaces biden, the deep state will continue regardless.

the rise of India is troubling a whole lot of BIF people, and their countries too.....

for instance, a deal between the amerikis and the cheeni may well see a drastic erosion in India's position and prospects.......
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Re: Pakistani Economic Stress Watch

Post by vimal »

US can just print dollars and give it away. Reserve currency has its advantage
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Re: Pakistani Economic Stress Watch

Post by chetak »

vimal wrote:US can just print dollars and give it away. Reserve currency has its advantage
but routing it via the IMF, the US retains a hook and also the leverage to influence the roll over of the loan, or not
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Re: Pakistani Economic Stress Watch

Post by Manish_P »

Great move i say. They are running out of both anyway...

Yawn - Proposal under study to make gas and power rates uniform
The government firmed up key principles on Thursday for hiking gas prices to the extent of full cost recovery so as to compel consumers to shift to electricity for space and water heating during winter. # looks like abduls have to soon get used to taking cold baths

“To reduce the demand for gas in the domestic sector, prices can be rationalised to bring about parity between gas and electricity prices. This will encourage gas consumers to use electricity for space and water heating during the winter,” said the statement.

Switchover to electrical appliances for heating can save an estimated 74,736 million cubic feet of gas, the meeting was told.

As a result, 6,778 gigawatt hours (GWh) of least-cost electric power can be generated from gas.

The meeting noted that the existing long-term contracts with Qatar Gas include a clause for contract revision in 2026. A revision of the price cap was among the provisions and the supplier could demand an increase in the LNG delivered cost or just walk away from the contract.
Atmavik
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Re: Pakistani Economic Stress Watch

Post by Atmavik »

^^ while listening to a paki podcast I learned that the piped gas that the rich and upper middle class get is 10 times cheaper than the lpg cylinder that the poor have to buy
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Re: Pakistani Economic Stress Watch

Post by Manish_P »

Atmavik wrote:^^ while listening to a paki podcast I learned that the piped gas that the rich and upper middle class get is 10 times cheaper than the lpg cylinder that the poor have to buy
:shock: 10 times? Hard to believe but then it is pakistan.. most of the poor would be using firewood or coal probably

Here in India piped gas is slightly cheaper but not by much. In my use case the bill would come out to be pretty much the same.. with piped gas beating the cylinder on convenience.
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Re: Pakistani Economic Stress Watch

Post by Dilbu »

Alarm bells: SBP-held foreign exchange reserves plunge $923mn, now stand at mere $3.7bn
Foreign exchange reserves held by the State Bank of Pakistan (SBP) dropped a massive $923 million to a mere $3.7 billion, data released on Thursday showed. This is the lowest level of SBP-held reserves since February 2014.

Total liquid foreign reserves held by the country stood at $9.5 billion. Net foreign reserves held by commercial banks stood at $5.8 billion.

Last week, foreign exchange reserves held by the SBP rose by $258 million to $4.6 billion. This was the first increase in eight weeks.
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Re: Pakistani Economic Stress Watch

Post by nandakumar »

chetak wrote:
vimal wrote:US can just print dollars and give it away. Reserve currency has its advantage
but routing it via the IMF, the US retains a hook and also the leverage to influence the roll over of the loan, or not
Also relevant in this context according to the covenants agreed to by all countries before they are admitted into the IMF is that dues to the IMF has overriding claim over all other claims and overseas resources of borrower nation.
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Re: Pakistani Economic Stress Watch

Post by Dilbu »

ENI unable to deliver Feb LNG cargo to Pakistan, declares force majeure
KUALA LUMPUR, Jan 26 (Reuters) - Eni (ENI.MI) said on Wednesday that the delivery of a liquefied natural gas (LNG) cargo to Pakistan LNG Limited that was scheduled for February has been disrupted due to an event of force majeure.

The Italian major has a 15-year deal to supply Pakistan LNG with one cargo a month from 2017 to 2032.

"February LNG delivery disruption is beyond the reasonable control of ENI and due to an event of force majeure. ENI does not benefit in any way from the situation," said the company in a statement to Reuters.
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Re: Pakistani Economic Stress Watch

Post by yensoy »

nandakumar wrote: Also relevant in this context according to the covenants agreed to by all countries before they are admitted into the IMF is that dues to the IMF has overriding claim over all other claims and overseas resources of borrower nation.
That is perfectly reasonable. IMF is the lender of last resort. A country approaches the IMF when everything else is bust, and if the IMF lends it is to a very risky creditor - it is only natural that they should be paid first for having taken that risk. Last in - first out.

Interestingly, IMF/WB has no authority to waive debts. I guess there must be some other mechanism or crowdfunding needed if debts were to be cancelled.
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Re: Pakistani Economic Stress Watch

Post by Neela »

IMF bailout - how much is it?
More importantly, then what ? Higher taxes, Higher electricity prices, higher petrol duties and possibly more revenue for the govt. But the spending and/or loot will not stop. Will the IMF grant be seen as the last chance to smash, grab and run by the elite. Its an economic vortex any which way you dice it.

Who in their right mind in Pak is actually thinking of systemic reform? Industries are closing permanently. Textiles are closing shop. Even fertilizer imports are getting hit. There arent many products to sell . HOw are they going to get dollahs?
Essentially Pakistan has spent its way into absolute penury and destoyed its creditworthiness. And that means states/provinces will be encouraged to strike it out on their own.
Last edited by Neela on 27 Jan 2023 11:38, edited 2 times in total.
Atmavik
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Re: Pakistani Economic Stress Watch

Post by Atmavik »

PKR @. 266 .. God speed to them , boys played well
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Re: Pakistani Economic Stress Watch

Post by Manish_P »

^ Humbly requesting Shri Dilbu ji to take up the daily score keeping.

Inshallah the bois will reach triple century soon
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Re: Pakistani Economic Stress Watch

Post by Dilbu »

Manish_P wrote:^ Humbly requesting Shri Dilbu ji to take up the daily score keeping.

Inshallah the bois will reach triple century soon
Which score do you want to track sir? Official, unoffical, semi official, black or grey? :D
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Re: Pakistani Economic Stress Watch

Post by Manish_P »

:rotfl:

Good point
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Re: Pakistani Economic Stress Watch

Post by Rupesh »

Dilbu wrote:
Manish_P wrote:^ Humbly requesting Shri Dilbu ji to take up the daily score keeping.

Inshallah the bois will reach triple century soon
Which score do you want to track sir? Official, unoffical, semi official, black or grey? :D
Saar Official should score triple century.
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Re: Pakistani Economic Stress Watch

Post by Mollick.R »

this means IMF will give some Bakshis to porkies

146 containers from Pakistan Ordnance Factories head to Ukraine via its neighbours
Pakistan has stepped up military supplies to Ukraine from the Karachi Port, coinciding with fresh Western defence supplies to Kyiv to thwart advances by the Russian military in Ukraine in recent weeks, according to people familiar with the matter.

In recent weeks, Pakistan has increased ammunition and other defence supplies via third countries that border Ukraine, they said.

https://economictimes.indiatimes.com/ne ... 359359.cms
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Re: Pakistani Economic Stress Watch

Post by Dilbu »

Rupee freefalls to 268.3 against USD in interbank market
KARACHI: The Pakistani currency maintained a freefall for a second consecutive day, plunging by a fresh 4.78% (or Rs12.87) to a new all-time low of Rs268.30 against the US dollar in the interbank market at around 10:30 am on Friday.

Yesterday, the currency recorded the single largest slump in a day of 9.61% (or Rs24.54) to Rs255.43 against the greenback. Accordingly, the rupee has recorded a cumulative drop of almost 14% (or Rs37.41) in just two days.
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Re: Pakistani Economic Stress Watch

Post by Dilbu »

The Af-Pak Dollar Cartel
The fast-aggravating fiscal crises in Afghanistan and Pakistan further streamlined the already informal integration of the undocumented economies seeking to defy global statistics by spinning the fiscal wheel off the books. While this underground trade has helped sustain populations on either side of the Durand Line, it has also buttressed a macroeconomic menace: an Af-Pak dollar cartel.

While official figures put the informal Af-Pak trade figure at $2 billion in 2019, prior to the Taliban takeover, Exchange Companies and Forex Association Chairman Malik Mohammad Bostan claims that amount of trade is now being illegally conducted on a monthly basis. A Pakistan government report claims up to $70 million worth of U.S. dollars are being smuggled into Afghanistan every month. This means any commercial activity between the two countries through an official channel translates into a loss.

“The [official] trade is shutting down, people are incurring losses, many are becoming jobless. We have been asking the stakeholders to address this for a long time, but no one is listening,” said Zia-ul-Haq Sarhadi, coordinator of the Pak-Afghan Joint Chamber of Commerce and Industry.

Various merchants and businesspeople from Afghanistan and Pakistan spoke to The Diplomat about the difficulties posed by the customs authorities at both ends. “The Taliban officials often seize the currency that we are trying to take to Pakistan to purchase goods. The official documentation has become redundant,” revealed one Kandahar-based trader. The Taliban regime has banned the Pakistani currency’s use in Afghanistan, limiting exchanges to holding a maximum of 500,000 rupees.

Pakistan has put a $1,000 hard currency cap per visit to Afghanistan. Traders coming from Afghanistan are required to carry their export business license, invoice, and currency to the Torkham or Chaman border, where Custom Appraisement issues the declaration mandating the depositing of the payment in a Pakistani bank.

“Many times that money is never deposited in the Pakistani banks and is smuggled back into Afghanistan because the invoices and documentations are faked with the involvement of money exchangers,” Sarhad Chamber of Commerce and Industry Vice President Shahid Hussain told The Diplomat.
The money exchangers on both sides of the Durand Line have bolstered the currency cartel by manipulating trade, both actual and forged – the latter being a primary route for dollar smuggling. Currency notes are often hidden in vegetable trucks with perishable goods, often easily passing through the Green Channel dodging customs scanners. The U.S. currency has been smuggled via food items ranging from orange crates to beetle nut sachets.

“It’s the same eight to ten people involved in monopolizing dollar smuggling that have long used the hawala system to monopolize currency in the region,” added Hussain.

The hawala system involves the transfer of money without any physical movement of cash or documentation. While centuries ago it allowed individuals to conduct transactions in faraway locations, today it helps sustain a parallel economy without any government regulations, in turn maintaining ground for illegal monopolization by cartels. And, as a result, the hidden, yet powerful, Af-Pak dollar cartel has propped itself up by capitalizing on the forex shortage in the two countries.
“We deserve the cut that we get in all this since the market forces determining the interbank exchange rate do not factor in the violent forces enforcing their own regulations,” said an exchanger from Kabul’s Sarai Shahzadeh market, one of the hubs for the dollar cartel’s dealing, along with Peshawar’s Sarafa Bazaar. Those working in these markets, which face regular crackdowns from the respective regimes, further reveal how sections of the authorities that are clamping down are simultaneously facilitating the cartel.

“Of course, the Pakistani border forces too are involved in the illegal trade with Afghanistan,” former Finance Minister of Pakistan Salman Shah told The Diplomat. “Similarly, many times, the Afghanistan-Pakistan Transit Trade Agreement is misused by authorities, where goods never arrive in Afghanistan and are consumed in Pakistan without any duties and taxes. But these transactions allow Afghanistan to finance other goods. This is how the unofficially integrated [Af-Pak] economy is sustained.”

Now, with Afghanistan drained of war dollars, and Pakistan’s foreign funding drying up after its usefulness for Western powers plunged following the Afghan Taliban’s assertions of independence, the unregulated, undocumented, Af-Pak economy is giving the two formal economies a run for their money. And the dollar cartel is at the forefront of those profiting from the chaos.
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Re: Pakistani Economic Stress Watch

Post by g.sarkar »

Looking forward to a triple century by Showbaaz. We are almost there. Yeh dil mange more on Fridin and everydin.
Gautam
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Re: Pakistani Economic Stress Watch

Post by sudham »

So does this herald the return of Imran Khan as the savior at a future date? Would that not be an issue for India?
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Re: Pakistani Economic Stress Watch

Post by CalvinH »

sudham wrote:So does this herald the return of Imran Khan as the savior at a future date? Would that not be an issue for India?
BRF is looking forward to the Kaptaan's return. Real Paki performance started under his leadership.
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Re: Pakistani Economic Stress Watch

Post by Atmavik »

^^ Hajam sethi was harping for the last few yrs that Kaptaan is incompetent and PMLN with shownazz In charge are Efficient managers who can set right the sinking ship .

Well they blew a bigger hole in the ship and Hajam got the PCB gig .. these buggers are all the same ..
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Re: Pakistani Economic Stress Watch

Post by Bart S »

Sethi was also claiming that the PMLN and Ishaq Dar will bring the dollar back to 180
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Re: Pakistani Economic Stress Watch

Post by CalvinH »

Ishaq dar tried the typical Paki bluster and it failed. He thought that all he needs is time before Pakis beg borrow or steal from the world and negotiate with IMF on their terms. Sadly Bajwa's geoeconmics didnt work. Geopolitics didnt work either. No one is willing to entertain the cheap old W*** anymore.

Pakis were in their knees this time for real. What I wonder most is why didnt Cheeni bought the stock when it was available for cheap. Because Han believe it will go down more and better opportunities will show in future?
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Re: Pakistani Economic Stress Watch

Post by Dilbu »

China not coming to TSP’s help in a more pronounced way is indeed a mystery. Is it because of the Ukraine connection and MuNNA act? May be they are letting unkil pay the bill this time.
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Re: Pakistani Economic Stress Watch

Post by fanne »

i suspect what you said to be true Dilbu. The TSP who** suddenly lept out of bed to be with US and send shells, other stuff (and then have the audacity to ask Russia for cheap oil). TSP is a sink pit, money gets you loyalty for tonight only, and tomorrow is a different day. For today they want US to pay the bill.
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Re: Pakistani Economic Stress Watch

Post by CalvinH »

I dont think TSP did it suddenly. They waited for the Chinese to come with an offer and tried to show the cheenis that the world has another global war which makes Paki relevant and useful for the west, and that Chinese should show up now with money. Initial help to US was never advertised. Just leaked.

Now the help provided is all over the newspapers with the departing ports and dates specified..

I think Cheenis are giving Pakis an all out or all in option. No significant help unless gernails give up their dreams about opening Papa Johns in US.
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Re: Pakistani Economic Stress Watch

Post by Dilbu »

Not much talk about help from tarrel than mountain friend can be seen in TSP media also. It is as if they clearly know that China is not in their corner this time.
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Re: Pakistani Economic Stress Watch

Post by hnair »

Dilbu wrote:China not coming to TSP’s help in a more pronounced way is indeed a mystery. Is it because of the Ukraine connection and MuNNA act? May be they are letting unkil pay the bill this time.
Dilbu, a recap which we all know: there is a faction fight going on among khakis between khan-pasand and cheen-pasand afsars. Kaptaan was the face of the second lot but Bajwa switched sides when he saw his billionaire chaddi about to be pulled down by DC. So he got Kaptaan dislodged deftly with the help of the first lot (with nary a peep from the democracy lovers of west), so they can send Shabby with a sad face and begging bowl to western capitals. Currently khan and co are trying to rehab the first lot of khakis via Shabby and Blow-well. Cheen might be working on getting Kaptan propped up, but the current dominant faction of khaki is currently khan-pasand

However Pakis being brilliant, will bite khan’s hand soon and go back to cheen side once the factional loyalty of the Corps guys switches with their economic condition. Plus Khan does not get involved with their citizens (boots and labour) on ground like cheen does. So khan has their limitations when it comes to solving pak big infra problems.

Cheen, despite claims of Sooper-pawa status is still figuring out what hit them at Galwan and why they are running billion dollar losses around the sooth asia
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Re: Pakistani Economic Stress Watch

Post by CalvinH »

Cheeni bankrupting Sri Lanka should have beefed the case for the Khan pasand group too.
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Re: Pakistani Economic Stress Watch

Post by vimal »

On a pious Fridin, I have an important question to all members.

Who is the father of Pakistan?

1. Gandhi
a. Jinnah
b. Unkill Sam
c. UK
d. Araps
e. Ola Uber
f. Kaptaan
Last edited by vimal on 28 Jan 2023 07:44, edited 1 time in total.
Atmavik
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Re: Pakistani Economic Stress Watch

Post by Atmavik »

vimal wrote:On a pious Fridin, I have an important question to all members.

Who is the father of Pakistan?

a. Jinnah
b. Unkill Sam
c. UK
d. Araps
e. Ola Uber
f. Kaptaan
Add Cong eco system as .5 baap
vimal
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Re: Pakistani Economic Stress Watch

Post by vimal »

Done see option 1
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Re: Pakistani Economic Stress Watch

Post by Manish_P »

Dilbu wrote:
Manish_P wrote:^ Humbly requesting Shri Dilbu ji to take up the daily score keeping.

Inshallah the bois will reach triple century soon
Which score do you want to track sir? Official, unoffical, semi official, black or grey? :D
Kabul rate as well... :mrgreen:

Yawn - Open, black markets align closely after dollar surge
Days after the removal of an artificial upper cap on the rupee that sent the local currency into a nosedive, the dollar’s rate in the black market has come on a par with that in the open market, but uncertainty kept both the seller and buyers away on Friday.

The rupee closed at 262.6 per dollar in the interbank market, down 2.7 per cent, on Friday, after a 9.6pc slump on Thursday, which was its biggest single-day dip, according to the central bank.

However, the exchange companies issued the interbank rate of Rs 265 for the same day, reflecting variations in the rates in different banks. In the open market, the rupee slid by Rs 7 to reach 269, while the Kabul rate was quoted at 270 on Friday.
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Re: Pakistani Economic Stress Watch

Post by Cyrano »

https://www.newindianexpress.com/world/ ... 42185.html
Ahead of crucial talks, IMF spots Rs 2 trillion breach in Pakistan's budgetary estimates
The review would lead to the release of the next tranche of funds to Pakistan which has been pending since September
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Re: Pakistani Economic Stress Watch

Post by g.sarkar »

Al Jazeera's take:

They keep on comparing Pakistan with SL. But that is not true. SL has India to help out, and the population is smaller. Pak on the other hand is TFTA, SL is SDRE.
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Re: Pakistani Economic Stress Watch

Post by Dilbu »

Are we heading towards a total economic meltdown?
The economic crisis appears to have entered a critical phase in Pakistan as the cash crunch is fast squeezing the supply chains of everyday consumables with the eventual breakdown staring in the face.

The financial policy makers have squandered precious time giving rise to conjecturing that something more than economic considerations are involved in the crisis and that their resolution has become the main bone of contention.

Though it is not clear what such considerations could be but they are crucial enough to sustain the ongoing crisis and many analysts believe that unless a satisfactory settlement emerges the chances of the resolution of the issues are remote.
The situation has come to such a pass that the governor of State Bank of Pakistan (SBP) was heckled at the meeting of industrialists that normally try to stay at its right side. Added to the insulting treatment meted out to him the industrialists presented him with a key presented of the closed-down industrial units amidst allegation of corruption within the institution.

The central bank was accused of forcibly impeding imports in the country with the result that over 9,000 containers are stuck up at seaports threatening to break the supply chains of essential goods.

The import-dependent businesses are now teetering towards closure, which would trigger a breakdown of supply chains, as the country’s domestically manufactured goods are also based on imported raw materials. Goods such as wheat, fertiliser, cotton, pulses, onions, tomatoes, tyres, newspaper prints and electric bulbs are all imported to cater to the needs of the country.
The mushrooming crisis will soon tip over into an ugly catastrophe striking households, offices and hospitals. The central bank itself is in a quandary with a paltry $4.4 billion in reserves that are barely enough for three weeks of imports and the estimated needs to clear the containers and pending requests for opening more letters of credits stand in the range of $1.5 billion to $2 billion.

In addition to that, the government has stopped over $2 billion in payments of dividends, which will hurt future investment prospects.
More than the amount needed to grease the wheels of the economy, it is the impact of shortages due to disruption in supply chains that will cause catastrophe in the shape of more money chasing less number of goods.
Another serious issue raising its head is the expected shortfall in petroleum products and such fears are substantiated by one oil cargo of Pakistan State Oil has been cancelled while the fate of another letter of credit for another cargo is not known. Pakistan’s energy needs are met by import of energy products that is currently estimated to be a monthly arrival of 430,000 MT of petrol, 200,000 MT of diesel and 650,000 MT of crude oil that cost almost $1.3 billion. Pakistan is acutely energy deficient and any disruption caused in its import can cause serious problems for the country.
The current economic situation is making it very obvious that the government is left with hardly any option but to comply with the loan conditions that include a market-based exchange rate, increase in electricity and gas rates, additional taxes to make up for revenue slippages in order to contain the budget deficit within the original programme targets and removal of import curbs. In the interim the government is seriously mulling over introducing energy rationing but the political faction within in that is insistent to ward-off the onus of responsibility of the financial meltdown from the ruling coalition.
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Re: Pakistani Economic Stress Watch

Post by partha »

So Pakistan only has reserves enough for 3 weeks of imports. IMF has found PKR 2 Trillion hole in the budget and IMF team is coming next week only for further discussions and a deal at this point is still not guaranteed. Will IMF funds come through in 3 weeks? Even if it does, it's a tiny amount of $1 Billion and it's not like officials in KSA, China, UAE have their fingers ready on the "send" button to transfer billions as soon as IMF deal is clinched so in 3 weeks Pakistan could get $1 Billion in the best case which is no where sufficient. Is the default guaranteed in a month?

Have the Saudi officials completed their study to invest $10 Billion in Pakistan?
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