Loan-web and flood ridden Pakistan

After failing to obtain financial stability, Pakistan has, once again, decided to go to IMF hat in hand to get another loan to pay-off its previous ones. Surprisingly, instead of increasing its revenue by implementing tax reforms and increasing income attracting foreign investors, Pakistan government once again took resort in borrowing. It is estimated that total debt owed by Pakistan amounts $53 billion. It will be increased by $7.5 billion if we get another one. Already, around half of our tax revenue is spent paying installment of loans every year.

Given the Economic conditions, unfortunately, we need financial assistance. Be it in the form of Herman-Kerry-Lugar Law stipulated with stern conditions or some other loan assistance channeled via international monetary institutions. Sometimes, even at the expense of our sovereignty. Political analysts are of the opinion that in given circumstances Pakistan cannot exercise it's free will in its external and internal affairs. Their arguments are supported by surprisingly increasing drone attacks and other cross border violations despite our spelling repeated reservations.

Already plunging economy of Pakistan bore another blow when history's worst flood hit Pakistan this June. The region has never seen such mammoth devastation in at least hundred recent years. The destruction caused by recent floods exceeds Rs.385 billion which is larger than the combine sum total of loss faced in Tsunami, Haiti earthquake and 2005 Kashmir earthquake. The foreign Aid received in response to this colossal calamity is $16.16 per effected person which is far less than the ones collected during other disasters of the world; it was $1,249 in Tsunami and $1,087 in Haiti earthquake per effected person. The figures speak by themselves. The comparison is ridiculous.

There can be many reasons for this aberration. Some may argue that foreign community do not trust corrupt Pakistanis, while others would be of the opinion that it thinks that funding may help Taliban strengthen their infrastructure. In response to an article written by UN official urging world community to help flood effected people in Pakistan, I even read a gentleman saying that Pakistanis often talked about their Allah. Why are they asking for help to us? Why don't they pray to their Allah to help them? In effect, it the responsibility of people of Pakistan to help their fellow nationals. But one thing which is pretty much disturbing in the current scenario is that that IMF and World Bank has offered more loans to flood ridden state.                                            

 Given the Economic conditions, unfortunately, we need financial assistance. Be it in the form of Herman-Kerry-Lugar Law stipulated with stern conditions or some other loan assistance channeled via international monetary institutions. Sometimes, even at the expense of our sovereignty. Political analysts are of the opinion that in given circumstances Pakistan cannot exercise it's free will in its external and internal affairs. Their arguments are supported by surprisingly increasing drone attacks and other cross border violations despite our spelling repeated reservations.

In his book "Confessions of an Economic Hit Man"  a former US secret agent and economist, John Perkins, says that loans are being used to establish Economic Imperialism throughout the under developed world since World War II. Under Developed Countries are offered lucrative loans for development on generous terms. When this money is spent (often paid to US construction and power companies as par agreement) it is made sure, through secret agents, that these countries go bankrupt and become unable to pay their loan amount back. Once these countries are saddled with huge debts, they are requested "pound of flesh" in favors, including access to natural resources, military cooperation and political support.

The economic drop caused by current devastation in Pakistan requires more money. Unfortunately, instead of helping Pakistan by writing off standing loans, IMF and World Bank have offered more loans to Pakistan. Pakistan Government seems eager to accept these loans. We cannot bear another loan and they know it very well. But it seems every single opportunity to strengthen the loan-web is being availed. Perhaps Pakistan has become strategically more important for the world, or the growing rebellion among the inhabitants of this country is smelled by Uncle Sam.