All round confusion in government – Sure recipe for defeat

Mr. Prime Minster we have at least seven other options to avoid IMF loan..!

“ae tair-e-lahoti us rizq se mout achi – jis rizq se aati ho parwaz me kotahi”

Dear Mr. Imran Khan Sahab,

AoA.

Sir,

Tonight almost entire TV news channels of Pakistan were constantly playing your different speeches of few months back, wherein, you can be heard giving rock solid commitment to the nation that you will never go begging to the IMF for loans; and that a leader never lies with his public; obviously for the reasons which must have been in your knowledge about the research which concluded that suicide rates increased in the country’s which got loans from the World Bank and the IMF. In my opinion this phenomenon may have been occurring due to the reasons of higher unemployments created by the induced privatisations sans availability of any social support net work, increase in prices of items of daily use due to the devaluation of the currency and depression created because of the increase in utility rates and discontinuation of subsides, which are the fundamental demands of the loan giving agencies, to the already economically devastated and bankrupt countries.

Sir, if I were the PM and my economic managers would have suggested for resorting to IMF for a loan with strings of privatisations, massive devaluation of the currency, as happened with Pakistan on Tuesday 9 October 2018, when suddenly in the morning parity of PKR with USD took a dip to 137 from 125 (which according to one of your own speeches further burdened Pakistan with about $10 billion for just seeking a loan of $6-8 billion), increase in utility rates and removal of subsidies etc., I would have immediately replaced my entire team with such economic professionals, who could empathise with the pains and miseries of the teeming millions and had abilities to find alternative ways to meet the financial requirements of the country, which in my views are many, as explained below:

1 (a). Pakistan was economically devastated in fighting the American/NATO imposed War on Terror (as a front line State) suffering over $ one trillion losses in the shape of losses of human lives, financial and opportunity costs and damages to its goodwill and infrastructure; one example of which is that during this period Bangladesh moved ahead in education, family planning (1% population growth) and exports (45 billion USD/ year) which consisted mainly of textiles, by getting competitive edge over our textile industry, with zero percent tax for BD produced textile items (in developed countries) like towels and bedsheets etc., while Pakistani textiles were charged 20% tax, resultantly our products became uncompetitive and exports reduced from 25 billion USD to 20 billion USD per year.

1(b). In view of the foregoing, rather than going for borrowing from IMF we should seek (with diplomatic help as well) a moratorium on repayment of loans for five years and side by side implement the following scheme, to build up our foreign exchange reserves, so that economic crisis could be overcome with some out of box thinking to tackle the economic crisis from both supply and demand sides:

1(C). Immediate launching of a scheme for payment of 3% to 5% PA profit (payable bi-annually) on Foreign Currency bank deposits in Pakistan (backed by the sovereign guarantee of the GoP) with a suitable, but attractive fixed period, as suggested below:

~3% PA profit on deposits up to 2 million USD.

~3.5% Profit on deposits over 2 million USD and up to 3 million USD.

~4% profit on deposits over 3 million USD and up to 4 million USD.

~4.5% profit on deposits over 4 million USD and up to 5 million USD.

~5% profit on deposits over 5 million USD.

~The profits on the above scheme should be payable in the USD and should be exempted from ALL taxes and other deductions, as is also the case with Euro and Sukook Bonds, issued by the GoP.

This is a fool proof scheme, sans any risk, [if at all if fails, government will bear no loss] which can boost up our foreign reserves, in a very short time, on extremely cheap rates, as compared to the foreign loans and international bonds, which were sold by the previous government of PMLN, at even 8.25% interest rates: plus undisclosed Tax Exemptions of at least minimum benefits of around 7% (Pakistan will be repaying USD 910 million for USD 500 million Euro Bonds) for which the then PM Mian Nawaz Sharif was requested to hold an inquiry, to fix the responsibility of the culprit(s), who allowed the sale of Euro Bonds, on such a criminally high interest rates.

2. May approach REBO Bank and IDB which offer funding at extremely low interest rates of 1% and 2% respectively. Here it must be remembered that although, IMF needs 0.9% interest to cover expenses on loans, yet, harsh conditions it charged 3% interest to Pakistan on its last loan to Pakistan.

3. May have tried to get funds from the Asian Infrastructure Investment Bank (AIIB), which is operated from Beijing, China.

4. May consider pledging gold with China or any suitable country for obtaining loan against gold, as India did in July 1991, when Reserve Bank of India pledged 46.91 tonnes of gold with the Bank of England and the Bank of Japan to raise $400 million.

5. As detailed proposal has already been submitted to you vide emails titled “Suggestions to recover Pakistani wealth stashed abroad” link:- https://www.snayyar.com/suggestions-to-recover-pakistani-wealth-stashed-abroad.html#sthash.mBhTyTki.dpbs

6. Billions of USD can be easily generated by selling the government lands recently taken back from the encroachers or the government may consider selling the prime properties of President House, vast chunks from the hundreds of Kanals of PM House, the Governor House Lahore or the Prime value land of GOR-1 in Lahore, where in a suitable area, a luxurious world class residential tower can be built, for the residence of the government officers.

Sir, concluding, I would strongly stress that before giving the go ahead for getting strings attached IMF loans, just ponder for a moment that the voters have given their mandate to you, reposing their full trust in your promise that Imran Khan will never lie with his supporters.

May you always have the Blessings of Allah (SWT) to serve Pakistan for a long time to come.

Best Regards,

Syed Nayyar Uddin Ahmad