Pakistan's new finance minister vows to tame inflation, cut interest rates

Pakistan's new finance minister Ishaq Dar (center) addresses media after taking oath in Islamabad, Pakistan, on September 28, 2022. (PID)
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Updated 28 September 2022
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Pakistan's new finance minister vows to tame inflation, cut interest rates

  • Ishaq Dar most famous for strong-arming central bank to liberally inject foreign exchange into market to prop up rupee
  • Pakistan’s foreign reserves currently stand at a level that cover just over a month of imports, making intervention difficult

ISLAMABAD: Pakistan’s new finance minister, Ishaq Dar, will work to rein in inflation and cut interest rates, he said on Wednesday, calling the rupee currency undervalued and promising a strong response to resolve the South Asian nation’s worst economic crisis.

In his fourth time in the role, the chartered accountant must tackle a balance of payment crisis, foreign reserves that cover barely a month’s imports, historic lows in the rupee, inflation exceeding 27 percent and the aftermath of devastating floods.

“We will control inflation,” Dar told reporters, referring to the deep-rooted challenges ahead, in televised comments made after he was sworn in. “We will bring interest rates down.”

He had a warning for currency market speculators, saying that the Pakistani rupee was undervalued.

“Our currency right now is not at the place where it should be, it is undervalued,” said Dar, who is known to favor currency market intervention to keep the rupee stable.

“I hope the speculators will stop. I think they have already got it and we are seeing the rupee rising,” he added. “No one will be allowed to play with the Pakistani currency.”

A member of parliament’s upper house, Dar got the job after his predecessor, Miftah Ismail became the fifth to quit in less than four years, amid persistent economic turbulence.

The rupee has been gaining firmly ahead of his appointment and stocks responded positively before Wednesday’s swearing-in.

WRECKED ECONOMY

The senior politician belonging to the ruling party of Prime Minister Shehbaz Sharif flew to Islamabad on Monday night after ending five years in self-exile in London.

In 2017, he had been facing corruption charges he says were politically motivated, but last week an anti-graft court suspended warrants for his arrest, enabling his return.

On Wednesday, the court extended the suspensions.

“I told the court that my passport was revoked,” Dar said after appearing in court.

“I wasn’t able to travel for the last four years,” he added, describing the legal action against him as political victimization by the previous government of Prime Minister Imran Khan.

Khan’s party denies this.

Analysts say Dar’s key mandate is to halt inflation that mainly stems from his predecessor’s unpopular decisions to stick to preconditions set by the International Monetary Fund (IMF), including rolling back subsidies made by Khan’s government.

Sharif’s coalition government says it inherited a wrecked economy after Khan’s ouster in a vote of no-confidence in April, a charge the former premier denies.

As the new government took over, the IMF’s $6 billion bailout package agreed in 2019 was in the doldrums because of the lack of an agreed policy framework.

Last month the IMF board approved the program’s seventh and eighth reviews, allowing the release of more than $1.1 billion.

The tranche, said former finance minister Ismail, was likely to be boosted after Pakistan sought help to remedy economic losses of an estimated $30 billion caused by the unprecedented floods.

The disaster could cut GDP growth below 3 percent, down from 5 percent estimated for fiscal 2022-23, the government has said. 


Pakistan to present legal position on Israeli policies in Palestine at ICJ hearing today

Updated 7 sec ago
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Pakistan to present legal position on Israeli policies in Palestine at ICJ hearing today

  • Case is on ‘Legal Consequences arising from Policies and Practices of Israel in Occupied Palestinian Territory”
  • Palestinian representatives on Monday accused Israel of colonialism, ethnic cleansing, apartheid and genocide

ISLAMABAD: Pakistan will present its legal position today, Friday, at ongoing advisory proceedings of the International Court of Justice on the policies and practices of Israel in the Occupied Palestinian Territory, a spokesperson for the foreign ministry said. 

The International Court of Justice, the principal judicial organ of the United Nations, is holding the public hearings from February 19-26 at the Peace Palace in The Hague, the seat of the Court. 

“Tomorrow [Friday] evening, Minister for Law and Justice, Ahmed Irfan Aslam, will present Pakistan’s position at the ongoing advisory proceedings of the International Court of Justice in the case on ‘Legal Consequences arising from the Policies and Practices of Israel in the Occupied Palestinian Territory, including East Jerusalem’,” the foreign office said.

“The proceedings stem from a December 2022 request by the United Nations General Assembly for an advisory opinion by the Court on the legal consequences of Israel’s policies and practices in the Occupied Palestinian Territory.”

During the course of Monday’s three-hour session at the court, seven representatives for the Palestinians said Israel’s rule in the West Bank and East Jerusalem was illegal, and accused the country of a litany of crimes, including colonialism, ethnic cleansing, apartheid and genocide.

Similar accusations were leveled against Israel by the South African delegation in court on Tuesday.

Jerusalem’s stance is that the ICJ advisory opinion sought by the UN General Assembly is illegitimate since numerous UN resolutions as well as bilateral Israeli-Palestinian agreements have established that the correct framework for resolving the conflict should be political, not legal.

Israel has not sent a delegation to the ongoing proceedings. 


IMF says won’t comment on ‘political developments’ after Imran Khan urges Pakistan election audit

Updated 22 min 12 sec ago
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IMF says won’t comment on ‘political developments’ after Imran Khan urges Pakistan election audit

  • IMF says will work with new government to ensure macroeconomic stability and prosperity for all Pakistanis
  • Khan plans to write to IMF urging audit of controversial Feb. 8 elections before it continues talks with Islamabad

KARACHI:The International Monetary Fund (IMF) said on Thursday it would not comment on “ongoing political developments” in Pakistan after lawyers for former Prime Minister Imran Khan said he would write to the global lender urging it to call for an independent audit of controversial Feb. 8 national elections before continuing bailout talks with Islamabad.

Pakistan averted default last summer due to a short-term IMF bailout, but the program expires next month and a new government will have to negotiate a long-term arrangement to keep the $350-billion economy stable.

Ahead of the bailout, the South Asian nation had to undertake a slew of measures demanded by the IMF, including revising its budget, a hike in its benchmark interest rate, and increases in electricity and natural gas prices.

Pakistan’s vulnerable external position means that securing financing from multilateral and bilateral partners will be one of the most urgent issues facing the next government, ratings agency Fitch said on Monday.

“I’m not going to comment on ongoing political developments. So, I don’t have anything else to add to what I just said,” IMF Spokesperson Julie Kozack told reporters when asked to respond to reports of Khan’s letter.

“We look forward to working with the new government on policies to ensure macroeconomic stability and prosperity for all of Pakistan’s citizens.”

On Thursday, Bloomberg reported that Pakistan planned to seek a new loan of at least $6 billion from the International Monetary Fund to help the incoming government repay billions in debt due this year. 

The country would seek to negotiate an Extended Fund Facility with the IMF, the report said, and talks with the global lender were expected to start in March or April.


Despite Islamabad fightback, skipper Rossouw inspires Quetta to victory

Updated 22 February 2024
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Despite Islamabad fightback, skipper Rossouw inspires Quetta to victory

  • In low-scoring match, Rilee Rossouw holds his nerve with 34-run inning to guide Quetta to victory
  • Gladiators’ Abrar Ahmed, Mohammad Wasim take three wickets each to keep Islamabad at bay

Islamabad: Despite a valiant fightback by Islamabad United, Quetta Gladiators continued their impressive run of the tournament by beating the former by three wickets at the Qaddafi Stadium in Lahore on Thursday. 

“Continuing our winning streak,” the Gladiators wrote on social media platform X after the match ended. 

Batting first, United scored a lackluster 138/9 at the end of their 20 overs courtesy of a stellar bowling performance from the Gladiators. Spinner Abrar Ahmed returned figures of 3/18 while Mohammad Wasim finished with 3/20. Akeil Hosein finished with 2/32 while pacer Mohammad Hasnain returned figures of 1/35. 

United’s only resistance in the batting department came from Agha Salman, who top-scored with a decent 33-run knock from 23 balls while opener Alex Hales scored 21 from nine deliveries. 

What should have been an easy chase for the Gladiators turned into a difficult one when United took quick wickets to put the pressure back on Rossouw’s squad. United skipper Shadab Khan returned figures of 2/24 while pacer Naseem Shah finished with 2/34. 

Rumman Raees and Hunain Shah took a single wicket each before Rossouw guided United to victory with a composed 34-run innings that came off 38 balls and featured only three boundaries. 

Opener Jason Roy provided the Gladiators an impressive start to the game by smashing 37 runs off 18 balls while Sherfane Rutherford held his nerves to score 29 runs from 23 balls before Naseem rattled his stumps.

The Gladiators and table-toppers Multan Sultans both have three wins from the tournament so far. Islamabad, with a single win and two losses, is at number three on the PSL points table. 
 


Pakistan blocks X for the sixth day as activists criticize the social media platform’s shutdown

Updated 22 February 2024
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Pakistan blocks X for the sixth day as activists criticize the social media platform’s shutdown

  • Ex-PM Khan’s party says restrictions on X have been placed by authorities to muzzle its voice on social media
  • Social media platforms are often used by protest organizers in Pakistan to call followers out to streets, plan demonstrations

ISLAMABAD: Pakistan’s media regulators have blocked the social media platform X, formerly Twitter, with users across the country on Thursday enduring the sixth day of sweeping disruptions, partial and complete shutdowns.

There was no comment on the outage by the Pakistan Telecommunication Authority and government officials have not responded to repeated queries from The Associated Press for comment.

Human rights activists have demanded a full restoration of Internet services and access to social media. Washington has also urged Pakistan to lift restrictions on X.

The outage was first observed over the weekend when the political party of Pakistan’s imprisoned former Prime Minister Imran Khan announced protests against what it says were rigged Feb. 8 parliamentary elections.

In the vote, candidates backed by Khan, who was barred from running, won most seats but short of a simply majority needed to form a government.

Social media platforms are often used by protest organizers to call followers out to the streets and spread the word about planned demonstrations.

Pakistan has witnessed an increase in political instability since the balloting. The country’s elections oversight body denies charges by Khan’s party that the vote was stolen. The Pakistan Tehreek-e-Insaf party or PTI said on Thursday that the restrictions on X have been placed by the authorities to suppress its voice on social media.

On Wednesday, US State Department spokesman Matthew Miller expressed concerns in a statement to reporters over the outage and restrictions on the freedom of expression and association in Pakistan.

“We continue to call on Pakistan to respect freedom of expression and restore access to a social media that has been restricted including Twitter, now known as X,” Miller said. “We have and will continue to emphasize the importance of respecting these fundamental freedoms during our engagements with Pakistani officials.”

Khan’s rivals, including the former Premier Shehbaz Sharif, are trying to form a coalition government. Sharif replaced Khan after his ouster in a no-confidence vote in parliament in 2022. Khan has since then been convicted offenses in what his supporters call politically motivated moves to keep him out of office.


Share in parliament’s reserved seats ‘legal right,’ ex-PM Khan’s party says

Updated 22 February 2024
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Share in parliament’s reserved seats ‘legal right,’ ex-PM Khan’s party says

  • Seventy reserved seats for women and non-Muslims in Pakistan’s assemblies are crucial in forming governments
  • Pakistan’s election regulator did not allocate reserved seats in Sindh, Punjab assemblies to party joined by Khan’s candidates

ISLAMABAD: Former prime minister Imran Khan’s Pakistan Tehreek-e-Insaf (PTI) party said on Thursday that getting a share in the National Assembly’s reserved seats was its “legal right,” as political parties in the country race to form the next government in the South Asian country. 

The PTI announced on Monday its candidates who contested as independents during the Feb. 8 polls and won, would join the Sunni Ittehad Council (SIC) party to claim a share in the National Assembly’s reserved seats. 

A ruling by Pakistan’s top court in January meant members of Khan’s party could not contest the election from their party’s platform but only as independents. Consequently, Khan-backed candidates stunned observers by winning more than 90 seats in the National Assembly, the lower house of parliament.

However, Khan’s party was faced with the prospect of losing reserved seats for women and minorities as they are only allotted to political parties based on their representation in the assembly.

“It is our legal right to claim and have the share in the reserved seats in the National Assembly and all four provincial assemblies,” advocate Shoaib Shaheen, a PTI spokesperson, told Arab News. 

“We will be getting our share through the SIC’s platform and have fulfilled all the legal requirements for it.”

Shaheen said the SIC would receive 27 reserved seats in the National Assembly, adding that there was “no reason or any legal justification for depriving us of these seats.”

There are 70 reserved seats in the National Assembly out of which 60 are for women and 10 for religious minorities in the 336-member house. These seats are allocated to parliamentary parties on a proportionate basis. Likewise, the reserved seats in the four provincial legislatures are also allocated to the parliamentary parties based on their numerical strength in the house.

Each reserved seat in the National Assembly would be allocated against 4.8 members and by this formula, the SIC may receive 19 seats as the party has 92 members in the National Assembly. 

As of Thursday, 86 independent members backed by Khan pledged their allegiance to the SIC and submitted their affidavits to Pakistan’s election regulator announcing they have joined the party. 

Shaheen explained that Khan-backed members joining the SIC was also necessary as the PTI wanted to bring all independent members of the party under a parliamentary party to avert defections, play a collective role in the legislation and vote, oppose, or abstain from voting on important matters, such as the national budget.

“We will have a formal alliance with the SIC after the PTI’s intraparty polls, which will hopefully be completed by the first week of March,” Shaheen said.

Political parties who had contested the polls had submitted a list of their members for the reserved seats for women and non-Muslims beforehand to the Election Commission of Pakistan (ECP). 

However, the SIC did not do the same. 

Shaheen brushed aside the concern, saying that “it doesn’t matter” and that the SIC was now submitting a list for the ECP’s consideration.

As per notifications released by the ECP on Thursday, the regulator did not allocate any reserved seats to the SIC in Punjab or Sindh’s provincial assemblies. The list of allotted reserved seats for the National Assembly had not been published till the filing of this report. 

Former ECP secretary Kanwar Dilshad said it was the election oversight body’s “prerogative” whether it wanted to allocate reserved seats to the SIC or not.

“It is the sole prerogative of the election commission now to decide on the matter,” Dilshad told Arab News.

ECP spokesperson Hamid Raza said he would provide an update on the matter when the election regulator takes a decision. 

“At the moment, I am not in a position to comment on it,” Raza told Arab News.

Rashid Chaudhry, the deputy director of programs at the Free And Fair Election Network (FAFEN) in Pakistan, cited a precedent where three provincial legislators in the northwestern Khyber Pakhtunkhwa province joined the Balochistan Awami Party (BAP) in 2019 after winning as independent candidates.

Chaudhry said the party was later allocated a reserved seat for women even though it had not submitted a priority list with the ECP before the elections.

“The precedent is there, and it is now up to the election commission to decide on it,” Chaudhry told Arab News. He said political parties could submit a new list of nominations to the ECP if their previous lists would stand exhausted.

“Obviously if the ECP denies the share of reserved seats to the SIC, the matter will land in the Supreme Court for adjudication,” he noted.