Mir Mohammad Ali Khan |
What “If” the IMF indirectly says no to us. How can they do that and why would they do that. The two most important questions we need to discuss here are ‘How’ and ‘Why’.
Let’s talk about why first.
Why would they do that? The answer for this lies not in conspiracy theories or their love or supposed hatred for us or anything even remotely close to it. They could do that because the main sponsor or the largest stakeholder is them, and around 16% of the voting power lies with America and the other majority of 35% lies with its allies.
The IMF can create such stringent conditions in addition to their normal conditions so that Pakistan HAS TO back away because if it does not, IMF would put our economy in perils.
So what America says, actually goes in the decision-making process. IMF is not a democratically governed institution where every party has just “One Vote” and the process of decision making is balanced. Now the question comes to mind that why would America want to meddle into such a small loan– possibly about $10 to $12 billion dollars– from IMF to Pakistan?
Well, the reason is that there are two elephants fighting in the yard and we are the ants being crushed by their heavy feet. The two elephants are America and China. And Pakistan happens to be the ant. America and China are fighting an economic war right now with tariffs and politically inclined economic war statements. One wants to increase their exports into the other country and the other one wants the same.
Read more: IMF Programme: Challenges and Opportunities – Dr. Omer Javed
America wants to punish China and “Its Friends”. And Pakistan is the most overt friend of China. And the best way to punish Pakistan is to put conditions on it that they cannot meet, right when they need the help. America wants to know the exact workings of the CPEC structure. Why? because it wants to point out mistakes or create issues that do not even exist in CPEC, to make it controversial.
The best way to attack China is to attack Pakistan. And how does America indirectly through the IMF attack Pakistan? By telling Pakistan that since it is involved in CPEC and since there are loans from China, first, the IMF can ask for those contractual agreements to be made public, perhaps something Pakistan does not want to do because of financial or national security point of view, or secondly, the IMF can create an environment of uncertainty by issuing statements that the talks with Pakistan for the loan are hitting a wall. Thirdly they can accuse Pakistan that it would be paying China its loan back from the IMF loan.
It’s about time that we stop becoming apologetic about who we are and stand our ground, with The IMF or The Americas or even China.
Well, I want you to know the fact from now. Pakistan will owe an installment to China in 2019 of about $1 billion. There is no installment coming up in 2018 so no money from the IMF can and will be used for Chinese payback.
How can the IMF create havoc for Pakistan so its relationship on one side can be damaged with China and on the other side make the Chinese project of BRI, or the Belt & Road Initiative– which is the parent project of CPEC–look bad in the world’s eyes by creating controversies about it, such as if China is taking advantage of small countries like Pakistan, so that no new country join BRI in the future.
The IMF can create such stringent conditions in addition to their normal conditions so that Pakistan HAS TO back away because if it does not, IMF would put our economy in perils.
Read more: Pakistan forced to return to IMF!
So can it happen? Yes, there is a huge possibility. How can Pakistan mitigate this IF it happens? Well, we need to have a Plan B. A plan that the IMF should also know or have an idea about that if they put too much pressure on us, we have other options.
I pray to Allah that we the Pakistanis become wiser and so does our Government. It’s about time that we stop becoming apologetic about who we are and stand our ground, with the IMF or the Americas or even China. It is simple as that and let’s keep it that simple.
Mir Muhammad Ali Khan is the first Muslim founder of an Investment Bank on Wall Street. He is the author of 4 books and has published over 800 articles. The views expressed in this article are author’s own and do not necessarily reflect the editorial policy of Global Village Space.