ISLAMABAD: A global rights organization has called for the protection ofeconomically disadvantaged people in Pakistan by broadening socialprotection systems in the country as officials in Islamabad discussstructural reforms with an International Monetary Fund (IMF) delegation tounlock a stalled bailout program amid a severe dollar liquidity crunch.
The negotiations between the two sides began on February 1 and are expectedto conclude during the ongoing week. A successful outcome of the talks willhelp the government secure $1.1 billion from the international lender undera loan agreement signed in 2019.
The financial assistance from the IMF is likely to ease the cripplingshortage of foreign exchange in Pakistan and make other sources of fundingaccessible to the country. However, the economic reforms currently underdiscussion are likely to put significant burden on low-income segments,making the government concerned about a likely political backlash in anelection year while forcing rights organizations to ring alarm bells.
“Millions of Pakistanis have been pushed into poverty and denied theirfundamental social and economic rights,” said Patricia Gossman, associateAsia director at Human Rights Watch (HRW). “The IMF and the Pakistanigovernment have a responsibility to address this crisis in a way thatprioritizes and protects low-income people.”
Read Top Stories
In a statement issued earlier this week, HRW noted the IMF was askingPakistan to remove energy and fuel subsidies, move to a market-basedexchange rate and increase its general sales tax rate. It maintained thiswas likely to make it harder for many people to meet their basic needs amidthe rapid depreciation of local currency and soaring inflation.
“The IMF program should conduct a thorough assessment of the direct andindirect impact these adjustments would have on low-income people andadequately mitigate them,” it added. “New tax measures should beprogressive in nature and should not exacerbate inequality and increase thecost of living in ways that undermine rights.”