Need Debt Restructuring, Not Debts, Financial Times advises Pakistan

The British journal Financial Times has pointed out that Pakistan is currently standing on the brink of collapse, how dangerous the bankruptcy of a country that is a nuclear power, with the fifth largest population in the world, Sri Lanka, could be. The population of Pakistan is three times less than that of Pakistan, it is trying to survive once again, if Pakistan defaults, how will Pakistan be on the path of development again?

Financial Times writes in its editorial that the removal of exchange controls has caused the rupee to depreciate against the dollar. Pakistan is facing the worst challenges in its modern history. Every morning the news is telling stories of the destruction of the Pakistani economy.

Pakistan’s economy has reached the brink of collapse due to government incompetence and climate change, on the other hand, more than 100 people have been killed in recent terrorist attacks.

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The Financial Times writes in its editorial that Pakistan’s foreign exchange reserves have dwindled to less than $3.7 billion, which is insufficient to meet the month’s import requirements.

Financial Times writes that Pakistan is in talks with the IMF to complete the 9th review to revive the crisis-ridden economy, as the country’s foreign exchange reserves have fallen to extremely low levels and businesses are shutting down.

The Financial Times, citing the State Bank in its report, writes that hundreds of containers loaded with imported goods are anchored on the beach of Karachi but the buyer does not have the dollars to pay.

The British journal “Financial Times” further wrote that due to the challenges faced by the economy in Pakistan, energy reserves are decreasing due to which the fear of power crisis has increased. There are serious difficulties. Due to non-availability of dollars, textile industries are facing severe difficulties in purchasing raw materials, and many factories have closed due to lack of raw materials.

After Sri Lanka, Pakistan risks defaulting, fears of a food and medicine crisis in the country have increased, and the nuclear-armed country’s military has a history of intervention. Islamists and extremists are once again carrying out bloodthirsty attacks.

The Financial Times writes that if Pakistan is to be saved from default, international financial institutions and international creditors will have to help Pakistan, as Pakistan’s foreign exchange reserves remain at $3.7 billion, enough for three weeks of imports. shall be. While debt is $270 billion, which is 79 percent of GDP. The situation is that it is becoming difficult to just keep the lights on.

Separately, floods wreaked havoc in Pakistan last year, which caused $30 billion in damage, excluding the loss of life, but the international community agreed on a $9 billion recovery aid package, the Financial Times writes. What did But when and how they will meet, no framework has been decided yet.

China is Pakistan’s second-largest lender after the IMF, with total loans of about $30 billion, excluding $1.1 billion owed to independent Chinese power producers for electricity purchases.

The Financial Times further writes that China, the IMF and the Paris Club of creditor countries need to start talks to restructure Pakistan’s debt soon. On the other hand, Pakistan has to seriously adjust its design for debt restructuring.