CPEC Financing: Is Pakistan Being Ripped Off By China?

[Sky lord]

I have noted with concern how @Gufi & @Kaptaan have disparaged Pakistani Industrialists. They seem to have used their emotions and skewed perceptions take the better of their posting skills.

I was an industrialist and my company was wiped out during 2013. This had a lot to do with not having electricity for 14-18 hours a day. I struggled to pay my labor and in trying to save my company and my reputation, I lost most of my capital. It was a point of pride to employ people and while I took the beating, not one person can fault me for having not paid my staff.

By calling Industrialists leeches, you are doing a dis-service to our country & our economy. Throw the Industrialists out and see how it goes? We did that in 1973, remember? It turned out real well did it not? There was zero investment until early 80s and that too started on a very meager scale. Pakistan has really enjoyed the lack of investment and growth, has it not? Is it any accident that biggest industrial unit installed in Sudan in late 1970s was a textile mill installed by Gen (R) Habibullah Khan? Sharif Brothers invested in UAE. Erstwhile owners of BECO (turned into PECO by Pakistan government) got dealership of Bethlehem Steel of USA and kissed manufacturing good-bye. Saigols too vowed not to invest in high-profile projects. It is no surprise that none of these families trusted Pakistan with all their wealth & experience (... hence Panama papers). Almost every industrialist who invested in Pakistan was an entrepreneur. Seeing how they have been treated is a sight to behold by many, including our Indian friends.

So we did real well in calling our Entrepreneurs (who invested in a new country with uncertain future) Leeches. Since it worked wonders in late 60s & 70s. It would work real well now too. Kyun bhai @Kaptaan & @Gufi ?

Productivity in an economy depends upon Labor, Kapital (Capital in original German), Human & Natural Resources.

Y (productivity) = A* f[L, K, H, N]
where A is the technological constant reflecting the level of technology at any given time for an economy

To grow an economy, one can invest in Labor (left-wing politics), or Kapital (right-wing politics). Investment in Labor gives results in longer term, while investment in Kapital provides results sooner. They both complement one another too. Investment in K provides a trickle-down effect to L, and vice versa. To jump start an economy, it is best to first focus on K, to increase the size of the pie, and then to shift focus to L to sustain growth in longer term. This is what we did during Ayub years. The predictable down-side was concentration of wealth, that also happened in South Korea. But due to political instability and populism, the gains were thrown away. Army, Leftist press, economically illiterate analysts, & stunted populist politicians all played their part in the scheme of things. It is pertinent to note that Ayub Khan got rid of senior politicians (presumably including Feroze Noone, who negotiated Gwadar with Oman) via EBDO. The crop of politicians sponsored by military regime had gems like Bhutto... ;-)

In economics we study trade-offs. One of those is the trade off between Guns (Army) & Butter (Social services). There is no doubt which side of this trade-off was chosen by Pakistan under the brilliant leadership of generals, pliable politicians, & bureaucrats. I do not think there is a valid reason to cry about the quality of Human Resouce (workers, entrepreneurs, teachers, analysts, etc...), when we have invested more in military hardware than in schools. Point to note is that quality of our Entrepreneurs & the quality of their workers has depended upon their environment. So, there is little to complain about over here.

Now I can tell the predictable hee-haw that would ensue...

"we are talking about unpatriotic industrialists, not the patriotic, hard working ones"... (Mian Sharif was considered Patriotic & hardworking when Gen. Umrao Khan recommended him for manufacturing Wheat Thrashers in 1960s)

"we mean that our industrialists keep share of wealth outside of Pakistan"... (1973 Nationalization? Enough said)

"we mean that our industrialists have not invested in the country like they should have" ... (Yeah, sure, like you would)

"we mean that our industrialists are not educated and have no vision"... (give them electricity first... then complain)

"we mean that our industrialists have done nothing for the people" ... (they do try to employ people, in case you noticed)

"we mean that our industrialists only think about maximizing profits" ... (what else should they do? Read Economics)

"we mean that our industrialists have failed our country" ... (and not vice-versa? 1973? political stability? fiscal stability? white elephant projects so welllike PSM? Great press coverage? ELECTRICITY?... need more?)

I hope people study a little before proffering their opinions so readily.

So well written and from the heart.

What people forget is that industrialists NEED to make a profit. When the governance of a country is corrupt and/or incompetent, the only way to make a profit is to use corrupt and/or devious means.

Nobody wants to be a crook unless they are forced to be one.

The problem is not the industrialist but the system.

 

[Gufi]

concern

First of all, I would like to apologise as I seem to have offended you. But my observation is that you are yourself being emotional on the topic. You are one individual and you can not defend the industrialists in general.
Here is the top defaulters list by LESCO
http://www.lesco.gov.pk/5000071
Most are industrialists.
slightly old list on Sui defaulters
https://www.dawn.com/news/614725
and here are some bank defaulters
http://pakistanthinktank.org/pakist...ers-list-no-1-defaulter-euro-gulf-enterprises
47 private enterprises owe over Rs3 billion to SNGPL
The fact of the matter is that the Industrialists have leeched off the economy in real terms. They have not paid their bills, under paid employees and misreported taxes. Along with other issues like meter tampering being the norm, under reporting profits and poor quality control leading to an embarrassment abroad.

To grow an economy, one can invest in Labor (left-wing politics), or Kapital (right-wing politics). Investment in Labor gives results in longer term, while investment in Kapital provides results sooner. They both complement one another too. Investment in K provides a trickle-down effect to L, and vice versa. To jump start an economy, it is best to first focus on K, to increase the size of the pie, and then to shift focus to L to sustain growth in longer term. This is what we did during Ayub years. The predictable down-side was concentration of wealth, that also happened in South Korea. But due to political instability and populism, the gains were thrown away. Army, Leftist press, economically illiterate analysts, & stunted populist politicians all played their part in the scheme of things. It is pertinent to note that Ayub Khan got rid of senior politicians (presumably including Feroze Noone, who negotiated Gwadar with Oman) via EBDO. The crop of politicians sponsored by military regime had gems like Bhutto... ;-)

I totally agree with your evaluation of that era.

What you have written is a very solid piece on economic requirements and contributions of Industries.
But you have missed out the real policies taken by industrialists in Pakistan which is not the norm anywhere else in the world.

1. unpaid bills
2. tax fraud
3. under paid employees
4. stealing resources directly (electricity theft and natural gas theft)
5. Defaulting on loans
6. poor quality control

And since you have not practised these rules, you have no succeeded. The fact of the matter is that industry is the back bone of society. In a proper system(under CPEC with Chinese contributions towards a fair system) people like you (i.e real industrialists who work hard, are educated as seen by your eloquent post, and have the drive to work hard) will succeed. Those who steal electricity, do not pay their bills, do not pay back their loans, do not report profits properly to avoid taxes and use their employees like animals will fall.
It was not a rant against industrialists in general, but what industrialists have become. You of all people can understand how crooked the system is at the moment and a hard reset is needed to kick start it.

I was an industrialist and my company was wiped out during 2013. This had a lot to do with not having electricity for 14-18 hours a day. I struggled to pay my labor and in trying to save my company and my reputation, I lost most of my capital. It was a point of pride to employ people and while I took the beating, not one person can fault me for having not paid my staff.

Sir you are a rarity in this nation.

 

[Chak Bamu]

First of all, I would like to apologise as I seem to have offended you. But my observation is that you are yourself being emotional on the topic. You are one individual and you can not defend the industrialists in general.
Here is the top defaulters list by LESCO
http://www.lesco.gov.pk/5000071
Most are industrialists.
slightly old list on Sui defaulters
https://www.dawn.com/news/614725
and here are some bank defaulters
http://pakistanthinktank.org/pakist...ers-list-no-1-defaulter-euro-gulf-enterprises
47 private enterprises owe over Rs3 billion to SNGPL
The fact of the matter is that the Industrialists have leeched off the economy in real terms. They have not paid their bills, under paid employees and misreported taxes. Along with other issues like meter tampering being the norm, under reporting profits and poor quality control leading to an embarrassment abroad.

I totally agree with your evaluation of that era.

What you have written is a very solid piece on economic requirements and contributions of Industries.
But you have missed out the real policies taken by industrialists in Pakistan which is not the norm anywhere else in the world.

1. unpaid bills
2. tax fraud
3. under paid employees
4. stealing resources directly (electricity theft and natural gas theft)
5. Defaulting on loans
6. poor quality control

And since you have not practised these rules, you have no succeeded. The fact of the matter is that industry is the back bone of society. In a proper system(under CPEC with Chinese contributions towards a fair system) people like you (i.e real industrialists who work hard, are educated as seen by your eloquent post, and have the drive to work hard) will succeed. Those who steal electricity, do not pay their bills, do not pay back their loans, do not report profits properly to avoid taxes and use their employees like animals will fall.
It was not a rant against industrialists in general, but what industrialists have become. You of all people can understand how crooked the system is at the moment and a hard reset is needed to kick start it.

Sir you are a rarity in this nation.

1. Only Industrialists use electricity at a level where they stand out in case of default. There shall always be failures and there shall always be defaults on bank loans and utility bills; and that highest of these would belong to the business community, is no surprise. Your sample is simply biased.

2. You would be surprised that actually, where you find concentration of Industry, you would find lower line losses. Check out LESCO, GESCO, FESCOand other if possible, drill down to the individual power grid feeders. You will find that the lowest losses are from Industrial feeders. That is because, contrary to your assertion, Industrialists DO pay their bills. Now compare LESCO, FESCO, GESCO, etc.. with HESCO, QESCO, TESCO - all serving areas with little or no industrial activity. You would find very high line losses because of electricity theft by influential farmers and land lords. I have not studied gas distribution, but I am willing to bet that here too, you would find somewhat similar situation with Industrialists paying their dues regularly to keep their businesses going. One case of irregularity that I do know of was an Industrial concern violating their SNGPL mandated hours of operation (not theft, BTW) because they were fighting for their survival and had to complete an export order by hook or crook. I blame idiotic policy of encouraging CNG use as vehicle fuel at cost of Industry during Musharraf regime, & laziness in arranging LNG supply.

3. In a country where the most influential and well-off strata of society are exempt from paying Income taxes (and are responsible for most resource theft), it is a little unfair to target the Industrialist alone for under-reporting their taxes - especially since they are hounded by 101 government departments whose officials weild arbitrary powers. To tell you the truth, all the bribes that are demanded of the Industrialists should be adjusted in Income Statement as legitimate tax payments.

4. In a country where there are government-mandated minimum wages enforced by law, I do not think you can complain about Industrialists under-paying their workers. If a few Industrialists (only in rural areas, I suspect) do underpay some of their workers, you can certainly not complain about Industrialists as a class. You should, in fact thank them for investing & creating employment in a country where conducting legitimate business is viewed as an illicit activity by many.

Yours was a valiant effort to prop a weak case. But in absence of data and logic to support the same, it comes across as mere rhetoric. Nationalism and Socialism put together are a dangerous combination.

Meanwhile, please read the attached file which is a paper written by Dr. Syed Turab Hussain of LUMS. This shall help you understand the problems faced by industrialists, especially in SME sector. It is only a glimpse, but I can vouch for its contents. There are many more problematic areas which are beyond the scope of this paper, but it can be a start. Perhaps your allergy of Industrialists shall be cured? I hope you read a bit of sociology too, it might help you see society as a whole and not as disconnected segments where you can blame any one portion with sweeping statements.

 

[AUz]

@Chak Bamu

With different electricity projects coming online and further plans completed in future (hopefully!)---Do you see things improving in the industrial sector of Pakistan?

How would you rate Nawaz government's performance in regards to improving Pakistan's industrial base and hence economic output.

You seem to be more educated on the subject than most here. Your insights will be very welcomed.

 

[Chak Bamu]

@Chak Bamu

With different electricity projects coming online and further plans completed in future (hopefully!)---Do you see things improving in the industrial sector of Pakistan?

How would you rate Nawaz government's performance in regards to improving Pakistan's industrial base and hence economic output.

You seem to be more educated on the subject than most here. Your insights will be very welcomed.

The upcoming Electricity projects are very welcome. But the coal-based plants are at best stop-gap measures. The real meat is in the hydro-electric projects. Those would help lower the cost of energy and propel our industry forward. I am afraid that like with Kalabagh Dam, big hydroelectric projects would be derailed at one pretext or another. Sindh's agricultural class viewed Kalabagh dam with suspicion and so PPP made Pakistan walk into the trap of IPPs. I fear that we may fall into the habit of installing coal-fired plants and not be able to wean ourselves off and end up delaying hydro-electric projects. Any disruption in the supply chain of these coal-fired power plants (shipping, ports, railways, unloading, etc...) would cost us dearly.

PMNS government has certainly checked Pakistan's worsening economic situation. But their approach has seemed disorganized in the past (Quaid-e-Azam Solar Park, Gadani Power Park?) and they seem to be trying many things at the same time, as though in a hurry.

Chinese seem to be much more comfortable with PML-N government. There seems to be a level of trust that makes things happen. I hope that PML-N is not just thinking of re-election, but of the longer-term strategy which requires serious improvement in export earnings to help with balance of payments. CPEC projects would certainly challenge our balance of payments when the repatriation of profits happens and the loan installments are paid back.

The big worry is when (not whether) our exports will improve to the extent that our foreign currency reserves improve significantly. A corollary of this is that Pakistan Rupee, kept artificially high, will be devalued significantly. This would increase inflation, shock certain segments of economy, & some people (importers, retailers, opposition parties) would make a lot of noise. But it would be good for our economy over all. In my estimation, this will have to happen within one and a half year from now.

It is very likely that a few months before elections, a good bit of liquidity would be injected in the economy to make people feel good before elections. This too would cause inflation to rise. If GoP gets a loan from IMF, then this may not happen.

I hope that we have elections on time in 2018 without any major disruption, despite political instability being fomented. This would improve Pakistan's standing, image of our institutions, and signal political stability to international investors and creditors. These in turn would go a long way to stabilize Pakistan's growth. If PML-N can indeed ensure this, it would have done its job well.

 

[Chak Bamu]

Chak Bamu sb,

You are a wonderful lot- I meant entrepreneurs from the Indian subcontinent, pls dont lose heart. The problem is the Brahminical mentality that all folks from the subcontinent, including Muslims suffer from- people look down upon mercantile people and qualities. The famous Indian sociologist Deepak Lal I think it was who coined the term "disdain of the literary castes for the mercantile" or something of that sort. The nasty references to banya etc are part of that disdain.

Regards

PS: I am neither a bamman nor a banya, so I can be trusted to be a neutral observer.

Thanks Buddy. But this issue is not as severe in Pakistan. In fact with rise of House of Sharif, mercantile class has felt more empowered. If you observe closely, you would find that the reaction comes not from the land-holding class, but the educated & professional middle-class and people having connections with Army. Middle class feels that while they pay income tax, the business community does not pay its taxes (not quite true) and many of them being underlings of the mercantile class chafe at this. On the other hand, Military people suspect that the mercantile class, in order to further its class interests, wants to improve trade and relations with India at the cost of Kashmir.

The dynamic, if you note, is different than what you have described. Many business people in Pakistan have grown organically from various classes, though Sheikhs (Hindus trading class that converted to Islam in the last few generations) have a lot of influence. So you have a mix up without any discernible class structure among business community in Pakistan.

 

[Shah01]

By calling Industrialists leeches, you are doing a dis-service to our country & our economy. Throw the Industrialists out and see how it goes? We did that in 1973, remember? It turned out real well did it not? There was zero investment until early 80s and that too started on a very meager scale. Pakistan has really enjoyed the lack of investment and growth, has it not? Is it any accident that biggest industrial unit installed in Sudan in late 1970s was a textile mill installed by Gen (R) Habibullah Khan? Sharif Brothers invested in UAE. Erstwhile owners of BECO (turned into PECO by Pakistan government) got dealership of Bethlehem Steel of USA and kissed manufacturing good-bye. Saigols too vowed not to invest in high-profile projects. It is no surprise that none of these families trusted Pakistan with all their wealth & experience (... hence Panama papers). Almost every industrialist who invested in Pakistan was an entrepreneur. Seeing how they have been treated is a sight to behold by many, including our Indian friends.

So we did real well in calling our Entrepreneurs (who invested in a new country with uncertain future) Leeches. Since it worked wonders in late 60s & 70s. It would work real well now too

Thank you for this @Chak Bamu The above says it all. It pains me to know that the achievements of the first two decades were thrown away in a blink of an eye (nationalization). We still haven't recovered from it. The gains were destroyed by power hungry people, current generation is still paying the price of their selfishness.

 

[wiseone2]

I am sorry if I offended you. You must understand that when we talk about this subject by definition we have to use broad strokes. We know Pakistan police is corrupt. I think you would agree with that statement. I think you would also agree many PWD or tax officials are corrupt but we also know that not all of them are corrupt. Among them there are some honest, upright people but you know they are exception to the rule.

So in the same way you are exception to the rule. What I said about industrialist in Pakistan was statement as a class. That does not extend to each and every one. At any rate you can't have been a leech. If you were you would have managed to curry favour with the powers to either bail you out with loans or get some government contracts you sail you along.

The basic problem is that you expect industrialists to solve national problems of Pakistan. That is asking for too much. To become an industrialist you need capital, working knowledge, political connections and good industrial climate. Who has all of those in Pakistan ? You have to be rich, educated and politically connected. Then you have to be driven. Which rich dude wants to work 18 hours in a business ?

 

[Chak Bamu]

Thank you for this @Chak Bamu The above says it all. It pains me to know that the achievements of the first two decades were thrown away in a blink of an eye (nationalization). We still haven't recovered from it. The gains were destroyed by power hungry people, current generation is still paying the price of their selfishness.

But a segment of the current generation is repeating the mistakes of the past by letting populism get the better of them. It created a disaster before, it will create a disaster again. But the root of the problem is Establishment betting on political horses, and bookies (lota politicians, anaysts-for-hire, & sundry cronies) running to place their bets.

Seeds of disasters that overtook Pakistan in 70s were sown in 1958.

 

[SoulSpokesman]

Chak Bamu sb,

Thanks for the perspective, it was quite useful in understanding the social milieu for entrepreneurs in Pakistan.

Regards

 

[Shah01]

But a segment of the current generation is repeating the mistakes of the past by letting populism get the better of them. It created a disaster before, it will create a disaster again. But the root of the problem is Establishment betting on political horses, and bookies (lota politicians, anaysts-for-hire, & sundry cronies) running to place their bets.

Seeds of disasters that overtook Pakistan in 70s were sown in 1958.

Agree with you. I see selfishness and greed for money and power. People look for shortcuts but what they don't understand is there are no shortcuts in life. I think the current generation cannot appreciate/comprehend what BECO achieved at the time.... light/heavy engineering at the time ahead of any south Asian country. I give example of lathe machines made by BECO were highly respected. They did not achieve this in a day. All of that knowledge was thrown away.
The bold part is a gem. Rather than empowering the institutions they were destroyed in every way possible. Drain of experience and knowledge led to a perpetual decline in institutions and we end up with a society where there is no accountability, no vision and no security of any kind (Jaan, Maal, Izat). The blame is on the entire nation....

 

[SoulSpokesman]

Chak Bamu sb,

Seeds of disasters that overtook Pakistan in 70s were sown in 1958.

I am quite surprised to hear this. The general consensus I always thought was that 1958-68 was the golden era of Pakistan (Western half at least)- the Decade of Development. Even Korea looked upto Pakistan for guidance on economic matters.

Regards

 

[Chak Bamu]

Chak Bamu sb,

Seeds of disasters that overtook Pakistan in 70s were sown in 1958.

I am quite surprised to hear this. The general consensus I always thought was that 1958-68 was the golden era of Pakistan (Western half at least)- the Decade of Development. Even Korea looked upto Pakistan for guidance on economic matters.

Regards

Pakistan's boom and bust cycles of Economic development & Institution-building have been out of sync.

Pakistan lost political leadership with assassination of Liaquat Ali Khan in 1951. From then until 1956, the country was run on an ad-hoc basis by a coterie of bureaucrats. In 1956, under the premiership of Ch. Muhammad Ali (an upright senior bureaucrat) Pakistan's first Constitution was promulgated. This was a high point of institution-building and a land-mark. But in 1958 President Gen (R) Sikandar Mirza annulled the constitution. Within a month Gen Ayub Khan took over the government and sent Sikandar Mirza packing. This started a slide in institution building process since the only thing that could keep the country together (1956 Constitution) got buried. Economically though Pakistan's performance improved. The high point of economic cycle was 1967-68 and it coincided with widespread disaffection with Ayub Khan regime. Soon the situation of the ground deteriorated to the extent that Ayub Khan gave up power to Gen Yahya Khan in 1969.

We have repeated this cycle twice more. I hope good sense prevails and we continue with institution building and strengthening without a prospect of Army intervention, which necessarily violates Constitution when it meddles in politics.

So there you have it. This boom and bust cycle is not unique to Pakistan. Other countries have also experienced it. India has so far been lucky to avoid such a scenario, thanks to senior leadership that continued establishing institution after 1947, until nobody can imagine their violation - barring Indira Gandhi's Emergency imposition in 1975.

 

[SoulSpokesman]

Thank you, sir, that was quite explanatory. That said, it must be said that India's stability didnt result in superior economic performance, in fact until 1991 India was a chronic underperformer, which has meant that even now on many parameters esp poverty India fares worse than Pakistan. As my dear friend Prof Riazul Haq sb gleefully points out!

Regards

 

[StraightShooter]

@Gufi @Kaptaan

As I said in my earlier post on this thread

China needs Pakistan to be fully dependent on China to ensure that China's strategic interests are protected in IOR. China needs a weak Pakistan which relies completely on and only on China.

China is going to takeover Pakistan's Defense, Infrastructure, Industries, Education and Agriculture sectors.

We have already seen Pakistan ineligible or moving away from Worldbank & IMF while China chipping in money to help that cause twice in the last one year itself and more such help would surely come in the near future. China has $3 Trillion reserves while Pakistan's external debt is just $75 billion. Most of that $75 billion is towards China and China would easily payoff the the remaining amount of non-Chinese debts of Pakistan to ensure all of Pakistan's debt is with China only.

Pakistan can capitalize on $100 bn Chinese agriculture sector

https://defence.pk/pdf/threads/pakistan-can-capitalize-on-100-bn-chinese-agriculture-sector.513080/

We have already seen the news that Pakistan is moving away from Worldbank and IMF as China steps in

https://defence.pk/pdf/threads/paki...r-world-bank-loans.512457/page-4#post-9769274

Pakistan may soon be ineligible for World Bank loans

https://tribune.com.pk/story/1481612/pakistan-may-soon-ineligible-world-bank-loans/

China bails out Pakistan with over $1bn in loans
Kiran Stacey, Farhan Bokhari & Henny Sender
Published 12:32 PM ET Tue, 25 April 2017 | Updated 1:13 PM ET Tue, 25 April 2017Financial Times

Aamir Quershi | AFP | Getty Images
A Chinese worker stands near trucks carrying goods during the opening of a trade project in Gwadar port, some 700 kms west of the Pakistani city of Karachi on November 13, 2016.
China has deepened its economic pull over its neighbour Pakistan over the past year, providing over $1bn in loans to help the South Asian country stave off a potential currency crisis.

State-backed Chinese banks have come to the nuclear-armed state's rescue on two separate occasions, officials have told the Financial Times, with $900m coming in 2016, followed by another $300m in the first three months of this year.

The loans demonstrate the perilous fragility of Pakistan's stocks of foreign currency, which have been depleted in the past few months as imports have risen while both exports and inbound remittances from Pakistanis abroad have fallen.

Beijing's financial help also underlines the increasingly close relationship between the two Asian neighbours amid strains between Pakistan and the US.

Beijing is preparing to invest at least $52bn in Pakistan to build a highway, energy pipelines, power generation and industrial parks from the western port of Gwadar on the Gulf to the Chinese border 3,000km to the north.

But despite its expected impact on Pakistan's competitiveness, the infrastructure project — named the China-Pakistan Economic Corridor — is set to further deplete the country's stocks of foreign currency, needed to pay the contractors and suppliers.

Figures from the State Bank of Pakistan show the country had $17.1bn of net reserves at the end of February, down from $18.9bn at the end of October and a peak of $25bn several years ago.

This has forced the country to seek emergency loans from outside sources to repay older loans made in foreign currencies.

Of the $1.2bn from the Chinese institutions, $600m came from the government-run China Development Bank and another $600m from the state-owned Industrial and Commercial Bank of China, the only mainland bank to have a branch in Pakistan. Policy banks such as CDB often act on behalf of the central bank.

One Pakistani official said: "China keeps a very close eye on our economic trends and they're happy to come to our help wherever needed."

But experts are also warning that Pakistan is likely to have to return to international institutions such as the IMF, to which it sought recourse in 2013, for further support.

"Technically speaking we should have gone back to the IMF in January, but ministers are likely to try and wait until after the election [for parliament planned for 2018]," said Vaqar Ahmed, deputy executive director of the Islamabad-based Sustainable Development Policy Institute.

One member of the ruling PML-N party confirmed to the Financial Times that ministers were loath to return to the IMF until after the election in an effort to limit the political fallout."

The IMF is a politically volatile issue in our country. If we go to the IMF to deal with our needs, that will send a very negative political signal and the opposition [parties] will use that against the government," the person said.

It was only last year that the country completed repaying the IMF debt incurred in 2013, a repayment that led policymakers in Pakistan and abroad to express optimism that the country was finally on the path to economic stability.

Christine Lagarde, the head of the IMF, called it a "moment of opportunity" for the country.


https://www.cnbc.com/2017/04/25/china-bails-out-pakistan-with-over-1bn-in-loans.html