1958 — BAILOUT #1

The First Loan

Pakistan’s first IMF arrangement, a standby of $25 million, established a precedent of conditional lending that would shape economic policy for decades to come

. $25 MILLION

1971–74 — POST-WAR CRISIS

Loss of East Pakistan

Three loans in three years after the independence war of Bangladesh. External shocks and structural fragility have increased Pakistan’s reliance on the IMF.

 3 LOANS IN 3 YEARS

1988–1997 — STRUCTURAL ADJUSTMENT ERA

The Bhutto–Sharif Cycle

Six IMF programs under successive regimes. Privatization, deregulation and austerity become the standard. No reform of domestic institutions.

 6 PROGRAMMES

2001 — 9/11 & GEOPOLITICS

Politics Shapes the Bailout

So, the IMF is political. Weeks after 9/11, the US wants to incentivize Pakistan to work with them in Afghanistan, so the IMF gives ~$ 2B to Musharraf 's government.

 ~$2 BILLION

2008 — LARGEST LOAN IN HISTORY

Global Crisis Hits Pakistan

As the global financial crisis hit and foreign reserves were running low, the Gillani government sealed Pakistan’s biggest-ever IMF loan at the time.

 $7.6 BILLION

2019 — PTI AUSTERITY PACKAGE

Extended Fund Facility

A strong conditionality based $6 billion program. weakened twice - by COVID-19 and political crisis. Inflation is over 38pc. Electricity Prices Start Historic Climb.

 $6 BILLION (EFF)

2023 — BRINK OF DEFAULT

Emergency Stand-By Arrangement

Pakistan is heading toward a near-default situation due to political chaos, the fallout from the pandemic and 2022 floods that led to $30 billion in losses. $3B SBA with heavy prior actions taken.

 $3 BILLION (SBA)

2024 — BAILOUT #25

The Latest $7 Billion Program

Pakistan's 25th IMF program approved. External debt soars to $130B. Poverty, 40.5pc. Conditions Tax hikes, energy tariff reform, SOE privatization.

 $7 BILLION (EFF)

⚡ Energy Tariff Hikes

Under the IMF programs, electricity prices have shot up from Rs 10 to Rs 65 per unit, the highest in the region. Gas prices are up 840pc since 2019. It harms rural and low-income households and undermines industrial competitiveness.

? Regressive Taxation

GST increased to 18pc. Indirect taxes account for 60pc of total tax revenue, placing a disproportionate burden on the poor. The rich agrarian and trading sectors are still largely outside the formal tax net.

✂️ Subsidy Removal

Systematically dismantled fuel and food subsidies. Consumer buying power fell 38pc in 2023. Food insecurity currently affects 16pc of the population – exceeding emergency thresholds in many areas.

? Privatization Mandates

Required to sell state-owned companies. Failed attempt to privatize PIA in 2024. SOEs received PKR 905 billion in subsidies in FY22–23 but political economy makes structural reform very difficult.

?️ Fiscal Consolidation

To reduce the fiscal deficit to 5.9pc of GDP, public investment will need to be cut. The debt service is increasing; the development budget is decreasing. Sacrificing long-term growth for short-term macro-economic metrics.

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Democratic Conditionality Reform

IMF conditionalities must be debated in parliament and scrutinized by civil society. Pakistan should push for governance reform at the IMF in the G24 that enhances the voice and voting power of borrowers.