IT is time for the Nawaz Sharif government to celebrate. The International Monetary Fund has again voted in favour of its economic policies, ensuring the release next month of the third tranche of the $6.7bn Extended Fund Facility. The IMF, on the conclusion of the second review under the EFF programme, is “encouraged” by the overall progress made by Islamabad in pushing ahead with policies to strengthen macroeconomic stability and reviving economic growth. It has revised its growth estimate for the present fiscal from 2.8pc to 3.1pc on the back of reduced electricity shortages and unscheduled power cuts. It has happily noted that Islamabad has met nearly every quantitative performance benchmark and its reform programme remains broadly on track. The IMF is pleased with progress made to cut the power subsidy bill and raise tax revenues to bridge the budget deficit from 8pc to 3.5pc. The privatisation agenda remains on track, even if the government has yet to put up a company for sale.

The successful discussions with the IMF were largely anticipated. A couple of factors that could possibly scuttle the discussions were removed just days before Finance Minister Ishaq Dar left for Dubai. The State Bank governor was forced to resign, and power subsidy for users above 200 units was withdrawn without announcing it. The IMF remains unconcerned about the harsh impact of the ‘stabilisation policies’ on low- to middle-income segments of the population due to significant reduction in energy subsidies and substantial increase in indirect taxation. It is also not bothered about a jobless ‘economic recovery’. After all, it isn’t the job of the IMF to look after the people of a borrowing country.

These are things that governments that care about their people take into account before making policies. Governments that are worried about the plight of the common people make sure that the rich share the larger burden of economic stabilisation so that the poor and low-income segments of the population are spared from taking a hit. Pakistan’s financial managers have done quite the opposite. Still, the kind of recovery they had promised while executing the economic policies doesn’t seem to be getting us anywhere. Inflation is projected to rise more than what the budget had estimated. The budget deficit target, according to the State Bank, will be missed. Pressures on balance of payments are “likely to remain in place for months” as the government has realised just one quarter or $1.5bn of the foreign assistance it had projected in its budget. That too has largely come from the IMF. And the IMF mission’s refusal to come to Pakistan for discussions has sent an extremely negative signal to the world about the security conditions here. So what kind of recovery are we talking about?