IMF loan conditionalities

The IMF is out with stringent conditionalities and wants the economy to be fixed by undoing inherent corruption and by adhering to fiscal discipline.

The 39 benchmarks include maintaining forex reserves equivalent to three months of import bills, right-sizing public finance, keeping the difference between the open market and interbank exchange rates within 1.25%, and ensuring the reserves reach $8.65 billion by the end of the fiscal year.

It simply means tightening the belt by eliminating tax amenities and exemptions, and undoing the role of intermediaries in tackling inflation. But what constitutes the real catch-22 situation is the call for mandatory disclosure of assets of civil servants and their families by the end of February next year for being eligible for the second tranche of $1.1 billion under the bailout deal.

Touching the well-entrenched bureaucracy has been a dilemma in Pakistan. It is this cadre that holds the genesis of the system and is not only culpable for corrupt practices but has also resisted any change in status quo.

At the same time, the question is why only the civil servants, and why not the retired fat cats in the entire echelons of the civil-military domain, as well as politicians and business-centric elite strata?

The IMF's condition of issuing a 'governance and corruption assessment report' will be toiling and the incumbents will have to do some soul-searching before walking the tightrope.

Also, a ban on additional grants outside the budget will snatch the muscles of maneuvering that exigency-laden political quarters opt for to keep going in adversity.

The $7 billion loan facility has a wish-list to dispense with. There is no going back, and it's time to walk the talk and reform the entire edifice of the economy by burying ad-hocism. Monetary discipline and a corruption-free order can only be attained with digitisation, and by erasing loopholes of easy money. That is what the lender wants for an ordained economy.