Pakistan signed yet another staff level agreement with the IMF under the new extended fund facility it entered in July 2024. For this episode of the New Wave Global, host Asad Ejaz Butt speaks with Ashfaque Hasan Khan, former Economic Adviser to the Government of Pakistan, Director General of department of Economics at NUST about why the senior economist continues to be sceptical of the IMF program and believes that IMF’s policy interventions are less relevant to the context of the developing countries and ideas like monetary policy tightening (increase policy rate) have done more harm than good.
Both the host and guest dissect the IMF’s relationship with Pakistan in detail, historicizing the issue, to analyze the macroeconomic policy proposed by IMF in Pakistan. Khan believes that IMF is a political program, not an economic program whose success is largely determined by external political factors.
This episode features why inflation has come down crashing all the way? Inflation declined rapidly but the government now wants to normalize it within the 5% - 7% range. They also discuss why Pakistan is having a primary surplus in FY 2025 and why are remittances growing eventhough the exchange rate has stabilized since the last elections.