Drought in Cholistan I Eleven militants killed in KP
In Focus
The IMF Debate in Pakistan: Between Expectations and Reality
Nuha Aamina
In the news
On 28 March, The News International divulged that the International Monetary Fund (IMF) has approved PKR 1 per kilowatt hour in power tariffs, which will be offset by levies on Capacity Power Plants. Amid the rejection of proposals to cut taxes on electricity tariffs, Pakistan’s IMF Resident Chief, Mahir Binici stated that the tariff reduction will be entertained “provided it does not have negative effect on budgetary side.” Earlier, a Staff Level Agreement (SLA) was arrived at between IMF and Islamabad to disburse USD 1.3 billion under a 28-month arrangement of the Resilience Sustainability Facility (RSF). Alongside this, a successful review was completed under the USD 7 billion Extended Fund Facility (EFF) programme. As a result, total disbursements from the international lender amount to around USD 2.3 billion, 1.3 billion from the RSF, and one billion from the EFF’s second tranche.
On the same day, a Dawn article highlighted the Islamabad High Court (IHC) halting the government's plans to collect PKR 100 billion from industrial captive power plants as per an agreement with the IMF. A levy of PKR 791 per mmBtu was imposed to halt gas usage in industrial power generation. This would shift their dependency on the national grid for electricity. The revenue gained will be utilized to cut electricity tariffs for consumers. In response, a petition was filed by 20 industrial companies at the IHC. The petition deemed the Off the Grid (Captive Power Plants) Levy Ordinance, 2025, unconstitutional as it circumvented parliamentary authority and violated Article 77 of the constitution. The law dictates that taxes can be levied only through a parliamentary act. They further argued that they already pay taxes on natural gas and that they will be liable to pay a double tax if the ordinance is enacted.
On 27 March, Prime Minister Shehbaz Sharif emphasized the need to “get rid of” the IMF loan, wanting it to be the last programme.
The Debate in Pakistan:
An opinion in the News International titled “Pakistan’s post-IMF reality,” by former adviser in the Ministry of Finance, Dr Khaqan Hassan Najeeb, stresses the need for sustainable growth measures amid macroeconomic stabilization. He highlighted how the Pakistani economy has behaved by the book amid improvements in the current account, foreign reserves, and inflation. The recent SLA will further boost the stabilization process. However, such stabilization comes at a price of low GDP growth. Pakistan may receive external finances and commercial funding, but its international bond issuance remains unachieved. Despite a 32 per cent jump in remittances and the consequent surplus in current accounts, the balance of payments and trade deficit on goods and services remains high. Besides, the people have borne a huge burden to achieve the current “hard-won stability.” It was in the form of price adjustments for electricity and gas, enhanced levies on petroleum and heightened taxation. In this regard, Pakistan must engage the IMF in reducing the tax burden during the EFF’s duration on various groups of the economy and reconsider focusing on undertaxed areas. Moreover, the emphasis on climate reforms is a step forward in taking environmental considerations into economic planning. He also reiterated the importance of “deep structural reforms” in the economy to improve investment and employment opportunities for the populace. He wrote: “Engagement with the IMF has afforded Pakistan both time and space to undertake structural work, both within the programme’s purview and beyond.”
On 28 March, an opinion titled “The IMF lifeline,” in The News International argues that while the first EFF review and the SLA on RSF were successful, much work is needed to achieve long-term growth. The country may have achieved macroeconomic stability. However, it is “only the first step.” Its “import-heavy growth model” has made shifting to a competitive, export-led model elusive. All growth has come to a near halt under the programme and Pakistan is being forced to “live within its means.” Consequently, the ordinary citizen has had to witness inflating costs of living while their remunerations remain stagnant or dwindle. Hence, it is imperative to recalibrate the economy and set it on a path to sustainable growth where it does not have to approach the IMF for another loan. The editorial read: “Ordinary people have already been squeezed as much as possible, it is now the turn of the big fish to do the necessary for the country’s economic future.”
Along the same lines, an editorial titled “IMF's go-ahead, but” in The Express Tribune indicates the non-taxation of the “ultra-rich” as the IMF’s new demands continue to afflict the common man. Goals directed at fiscal consolidation, energy sector improvements, and control of inflation are set while “power producers, real estate, agriculture, and the likes” barely contribute to the state exchequer. It is as good as not addressing the existing structural gaps and poor performance in the economy as reforms in taxation, governance, and revenue disbursement in the social structures remain suppressed. In this regard, the editorial emphasized “bolstering social protection.” Besides, if Pakistan wants to stop approaching the IMF then it has to tax the rich.
An opinion titled “Is a recession looming?” in The Express Tribune, written by Atif Mehmood indicates a potential deceleration in global growth and what it means of Pakistan as its economy remains highly vulnerable to external forces. The Organisation for Economic Co-operation and Development (OECD) has indicated a downgrade in global growth to 3.1 per cent for 2025 and 3.0 per cent for 2026 while previous estimates stood at 3.3 per cent. On the other hand, the IMF and World Bank forecast stable growth for 2025 and 2026.The current economic fragility may heighten because of the US’ intensified tariff policies, impeding economic growth. The OECD has warned that such measures will disrupt economic momentum by “eroding investment confidence and curbing household spending.” There is a growing uncertainty of an impending recession. The New York Federal Reserve's recession probability model projected a 29.4 per cent recession likelihood in the US in the next 12 months. In such an environment, Pakistan ought to adopt “swift and resolute actions” to cushion the impact of global instability. The author concludes: “The moment for decisive leadership is now, for hesitation may prove far costlier than action.”
References
Malik Asad, “Power levy would have cut consumer costs,” Dawn, 28 March 2025
Mehtab Haider, “IMF allows Re1 cut in power tariff,” The News International, 28 March 2025
Syed Irfan Raza, “PM hopeful current IMF loan to be the last,” Dawn, 28 March 2025
Khaqan Hassan Najeeb, “Pakistan’s post-IMF reality,” The News International, 28 March 2025
“The IMF lifeline,” The News International, 28 March 2025
“IMF's go-ahead, but,” The Express Tribune, 28 March 2025
Atif Mehmood, “Is a recession looming?,” The Express Tribune, 27 March 2025
In Brief
ENVIRONMENT, ENERGY & WATER
PDMA looks to strengthen Cholistan Development Authority for combating possible drought
On 27 March, Provincial Disaster Management Authority (PDMA) convened a meeting to discuss measures which must be taken in order to combat drought in Cholistan. The meeting was presided by the Director of PDMA, General Irfan Ali Kathia. The meeting also saw the presence of deputy commissioners of Bahawalpur, Rahim Yar Khan and Bahawalnagar who joined online. The Managing Director of Cholistan Development Authority, Syed Tariq Mehmood Bukhari informed about the insufficient amount of water in the reservoirs due to a decrease in winter rainfall. Director General Kathia informed that Punjab has witnessed a decrease in rainfall by 38 per cent in the past four months. He also stated that all measures must be taken to combat “possible drought” and that the administration in Cholistan must remain vigilant. Further, he informed that more funds would be directed to Cholistan for enhancing their capacity to combat “possible drought.” Separately, Chairperson of Senate Standing Committee on Climate Change Sherry Rehman voiced his concern over the possibility of drought in Sindh, Balochistan and Punjab. She claimed that “climate change” and improper “water management practices” have aggravated the possibility of drought. (Imran Gabol, “PDMA moves to address Cholistan water crisis,” Dawn, 28 March 2025)
President Zardari approved federal government’s proposition to carve out “strategic canals,” says The News
On 28 March, The News International reported on the controversy regarding carving out “strategic canals.” PPP has strongly opposed the federal government’s proposition to carve out new canals. However, as per the source of The News, President Zardari has approved the government’s proposition of carving out new canals. Further, President Zardari also emphasized on uninterrupted “funding” to the canals from both “provincial and federal government.” As per the sources, President Zardari approved the proposition during the Green Pakistan initiative meeting which took place on 8 July 2024. In the meeting, President Zardari was briefed about the significance of canals like Thar Canal, Rainee Canal, Cholistan Canal, Greater Thar Canal, Kacchi Canal and Chashma Right Bank Canal. (Rana Ghulam Qadir, “Zardari gave ‘in-principle approval’ of controversial canals project in July 2024,” The News International, 28 March 2025)
On the need to fight the effects of climate change: “Pakistan now has to pledge to come up with local solutions to fight against this threat,” argues an editorial The News International
On 28 March, an editorial in The News International titled The Climate threat discussed the ramifications of climate change and the significance of climate funds to combat the effects. The editorial highlighted how the rich western countries are primarily responsible for climate change, however, the major brunt of it is being borne by countries like Pakistan. The editorial referenced the 2022 floods in Pakistan when around 66 per cent of Pakistan was impacted. This had/has compelled the “policymakers” to urge for climate funds. The editorial pointed out how Pakistan has condemned the inadequacy of funds which the rich countries had pledged for assisting the poorer countries in COP 29 for combating climate change. The editorial also warned that Pakistan cannot completely depend on funds from foreign countries to combat climate change. The editorial claimed that often the assistance from foreign countries results in the government compromising over the interest of its own people. The editorial also pointed out how in the coming times Karachi might have to deal with a huge inflow of “climate migrants.” The editorial further called for “local solutions” and reducing dependency from foreign countries to combat climate change. (“The Climate threat,” The News International, 28 March 2025)
SECURITY
Security forces neutralize 11 militants in Khyber Pakhtunkhwa
On 26 and 27 March, in four different military operations, 11 militants were neutralized in Khyber Pakhtunkhwa. As per Inter-Services Public Relations (ISPR), an intelligence-based operation was initiated by the security forces in Mir Ali, North Waziristan. The security forces were able to kill five militants in the operation. A separate operation was launched by the security forces in the same region where they managed to neutralize three militants. Separately, skirmishes took place between security forces and militants in Miramshah. The security forces managed to kill two assaulters. Another skirmish between security forces and militants occurred in Dera Ismail Khan. One militant was neutralized by the security forces. Security forces have confiscated “weapons and ammunitions” from the neutralized militants. The ISPR further informed that operations have been launched to root out any further left terrorists in the region. (Umer Farooq, “11 terrorists killed in security operations across KP,” Dawn, 28 March 2025)
Bomb blast in Quetta kills three civilians
On 27 March, a bomb blast took place at one of the main roads of Quetta. The blast killed three people and wounded another 21. One of the three who lost their lives in the incident was a “leading oncologist.” As per security officials, militants wanted to target a “police mobile.” Among the people who were wounded, four of them were police officers. Police informed that the blast was “detonated” using “remote control.” Further, they informed that the explosion resulted in damaging a number of “shops” in the area. Up until now, no militant group has accepted responsibility for the bomb attack. President Zardari issued strong condemnation against the bomb blast. He said “such reprehensible actions during the blessed month of Ramadan reflect the sinister motives of terrorists.” The attack received condemnation from PM Sharif as well. Separately, 14 people lost their lives in a number of attacks which took place across Balochistan. (Saleem Shahid, “Doctor among three killed in Quetta blast,” Dawn, 28 March 2025)
EXTERNAL
FO brushes aside anti-Pakistan policy introduced in US parliament
On 27 March, the Ministry of Foreign Affairs waived aside the introduction of an anti-Pakistan bill in the US House of Representatives. During the weekly briefing, Foreign Office spokesperson Shafqat Ali Khan stated that the bill was introduced by a single legislator. However, it does not align with the US policy towards Pakistan as their bilateral ties are “based on mutual respect, understanding and non-interference in each other’s affairs.” Commenting on another bill introduced to involve the US Global Magnitsky Human Rights Accountability Act which denies US visas and entry of human rights violators, he confidently stated it was the position of an individual lawmaker and not the entire US government. He noted that it would undergo several reviews before passage in the upper and lower houses and said: “We hope the US Congress will continue its supportive role in strengthening Pakistan-US ties.” In the backdrop, Special Assistant to Prime Minister Tariq Fatemi held talks with key leaders of the US Congress. Khan alluded that their discussion focused on bilateral and economic cooperation, especially in “the areas of trade, economy, and investment.” (“FO downplays ‘anti-Pakistan bill’ introduced in US Congress,” The News International, 28 March 2025)
INDIA VIEW
On India’s relations with US and China: “there is a growing realization in the US that India is unlikely to join the US in the advent of an outright Sino-US confrontation,” argues an opinion in The Express Tribune
On 28 March, an opinion in The Express Tribune titled “Can India contain Chinese influence in South Asia?” discussed relations between India and China amid former building closer ties with the US. Syed Mohammad Ali highlighted how Pakistan during the cold war had aligned with the US whereas India had remained “non-aligned.” After Bill Clinton assumed Presidency, the US had attempted to build deeper relations with India. The author pointed out that the US was keen to develop relations with India as it viewed the latter could “counterbalance” the “influence” of China in South Asia. On the other hand, Pakistan has also attempted to strengthen its bilateral relations with China. The author claimed that the US’s strategy to use India for counterbalancing China’s influence in South Asia is not working. The author noted how India is attempting to build closer ties with China while it is reluctant to forgo its relationship with Russia. As per the author, the Americans have realized by now that India would not support the US in the event of a possible conflict with China India depends massively on China which is its “largest trading partner.” The author further stated that the US has to come with a better strategy if it wants to counterbalance China’s influence in South Asia.
(Syed Mohammad Ali, “Can India contain Chinese influence in South Asia?,” The Express Tribune, 28 March 2025)
On India-Pakistan relations: “India’s 1962 war with China, passing away of Nehru may have triggered the thought that now was the moment to win back the part of Kashmir which had remained under Indian occupation,” claims an opinion in The Express Tribune
On 28 March, an opinion in The Express Tribune titled “India's grand design” gave an overview of the turbulent relation between India and Pakistan. Shahzad Chaudhry pointed out that Pakistan’s decision to increase tensions at Rann of Kutch was to exploit India’s vulnerability after it lost a war against China in 1962. As per the author, the Indian army was demoralized after its loss against China. In addition to that, the author highlighted two other reasons- PM of India Jawahar Lal Nehru “passing away” and India deciding to acquire nuclear weapons. The war with Pakistan in 1965, however, resulted in a “stalemate.” The author highlighted another incident in 1971 where an Indian Airline aircraft was hijacked by terrorists hailing from Jammu and Kashmir. The hijacked aircraft was brought to Lahore. Zulfikar Ali Bhutto had welcomed the arrival of the hijackers. All the passengers were set free once the aircraft landed in Lahore. The author mentioned how India was successful in bifurcating Pakistan in 1971. Pakistan realized that it would not be able to fight a conventional war with India. Thereby, Pakistan initiated “irregular warfare” against India. This again ignited the dispute over Jammu and Kashmir. The author also pointed out how an Indian Airlines plane was hijacked in 1999 which was flown to Kandahar amid Taliban rule in Afghanistan. (Shahzad Chaudhry, “India's grand design,” The Express Tribune, 28 March 2025)
On the disagreements between India and Pakistan over Indus Water Treaty: “New Delhi has reiterated its call for renegotiating the treaty three times” highlights an opinion in The News International
On 28 March, an opinion in The News International titled “Future of the Indus Waters Treaty” discussed the disagreements between India and Pakistan over Indus Water Treaty(IWT). Shafqat Kakakhel points out how the IWT is seen as “world’s most successful water-sharing agreement.” The author mentions how India has been continually demanding for discussion on “review and modify” of IWT. The author points out how India was reluctant to participate in Permanent Indus Commission (PIC) meetings until Pakistan agrees to have a discussion on amending the IWT. The author mentions how as per IWT, Pakistan has the right to three rivers from the Indus basin – Chenab, Jhelum and Indus. India on the other hand, could use water from three other rivers- Ravi, Beas and Sutlej. The author mentions that PIC was formulated where issues related to “implementation” of IWT could be discussed. The committee has “Indus Commissioners” from both the countries. The author mentions how India is reluctant to discuss its concerns at PIC as was suggested by Pakistan. The author mentions that India has remained adamant on amending the terms of the treaty.
(Shafqat Kakakhel, “Future of the Indus Waters Treaty,” The News International, 28 March 2025)
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Waheed Murad was granted bail on Friday. The reality of those who make false allegations against a Muslim during the holy month of Ramadan is that they attack someone's faith with a fake photo and a fake name. Such lies and fake news do not serve the government or the state in any way, but rather make the common people distrust state institutions.
- Hamid Mir
Terrorism in the country... The political leadership will have to play a major role on this important issue in KP and Balochistan!
- Nadeem Malik
Three judges of the Islamabad High Court, including the Chief Justice, have ordered a meeting with Imran Khan, while the powerful sitting in the Adiala have torn up that order. Now, if there were no contempt of court action, the Islamabad High Court would be considered to have ceased to exist.
Abuzar Salman Niazi
- PTI
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"We have so many young people in Pakistan. But most of them are uneducated and unskilled."
An opinion in Dawn, 'Labour market issues.’
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