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A look at pakistan economy and its relation with the imf and world bank

Story Imran Khan's worst nightmare will be Pakistan's crumbling economy From human development indicators like health and education to economic parameters like tax-to-GDP ratio, currency performance, and current account deficit, Pakistan's track record is dismal on all fronts.

Reuters Pakistan's economy is in shambles, and there is very little hope of its revival anytime soon. As the country's new leader, Pakistan Tehreek-e-Insaf PTI chief Imran Khan is about to secure democratically elected power from the previous government -- it has happened only once previously -- the task ahead of him is daunting. From human development indicators like health and education to economic parameters like tax-to-GDP ratio, currency performance, and current account deficit, Pakistan's track record is dismal on all fronts.

The country has received around a dozen bailout packages in the past 40 years. Its ever-expanding trade deficit and declining foreign reserves leave no option for the new government but to knock on the IMF's door. The US, which is the highest contributor of funds to the IMF, has already warned the global fund body, saying it should "think twice" before handing out the package as the money would be used to repay Chinese loans. So, how bad is the Pakistan economy, after all? Let's take a a look at pakistan economy and its relation with the imf and world bank at the country's economic condition.

As per the Pakistan Bureau of Statistics, Pakistan's inflation rate expanded to 5. Policymakers believe a developing nation's inflation should not exceed 4 per cent, while it should be around 2 per cent or below for a developed nation.

This is not a happy situation. To put it in perspective, let's compare it to Brazil. Pakistan's current account deficit CAD and fiscal deficit are exploding with 4. Pakistan's dependence on oil imports, poor CAD, and declining foreign reserves are signs of a deep worry. Pakistan imports around 80 per cent of oil from countries like Saudi Arabia, Iran, Kuwait, and Qatar.

The problems don't end here. It's essentially a situation of financial emergency. Ideally a country should have enough forex to pay for 3-6 months of import bills.

Here's a comparison of Pakistan's economic parameters with those of Brazil, whose population is close to the Islamic country. Click here to Enlarge Tax collection and inflation Half of the population of Pakistan doesn't pay taxes. Its tax-to-GDP ratio is one of the lowest in the world at 11. For India, it is 15 per cent; Brazil 32. Human development index The poverty rate in Pakistan was 4.

Around 40 per cent of people in Pakistan can neither read nor write. Pakistan is one of the lowest performers in the South Asia Region on human development indicators. The country's infant mortality rate is the lowest among its neighbours. Plagued with corruption from top to the bottom, Pakistan spends much less about 3 per cent of GDP on basic human needs like health, education, and nutrition; 44 per cent Pakistani children under 5 are stunted.

India's agricultural economy in deep crisis

As per the World Bank's 2016 figure, the country's birth rate is 19. Its human development index was 0. Both Islamabad and Beijing have worked together on this "flagship" project under the ambitious Belt and Road initiative to build railway projects, roads and maritime links. This is part of China's larger plan to gain influence in the region.

In the name of CPEC, China has been consistently helping its "all-weather friend" with financial loans. But Pakistan has no concrete plan to pay them back. Comparison with India While there's little to compare when it comes to India and Pakistan - as there's a huge disparity in terms of population and economic parameters -- India is way ahead than its neighbour in terms of GDP per capita, human capital ranking, money market, tax transparency and collection, imports and exports, and trade.

Imran Khan

India, however, is far behind than Pakistan in terms of trade deficit. Pakistani rupee exchange rate is 116.

US Warns Against IMF Bailing Out Pakistan's Loans From China

Imran Khan to the rescue Imran Khan, whose party won 115 of the 270 National Assembly seats, has not given a clear indication whether he'll take a reformist or a populist approach. Imran Khan's PTI, which has received the covert backing of Pakistan's military, gained the victory in the recent National Assembly polls on the promises of ending corruption and bringing economic stability. His closeness to the army could actually ease pressure on him to bring the desired changes on the economic front, unless, of course, he interferes with its business!