Ihtesham ul Haq

Kurzexposé zum Promotionsvorhaben von Ihtesham ul Haq

Pakistan Repeated Balance of Payments Crises and Drawdowns on IMF Loans

Pakistan has been facing balance of payments crisis, depleting foreign exchange reserves, regular budget deficits since the last three decades. Therefore, it regularly visits IMF to overcome the crisis, however, it has failed to break the begging bowl trap. For this reason, an in-depth study and research is required to find out whether Pakistan’s economic problems are rooted in domestic and national economic structures or due to foreign imposed agendas and to answer the following research questions:

i.             Why has Pakistan’s government not succeeded in overcoming the balance of payment crisis as a consequence of IMF loans and conditionalities? This will be analysed by considering “Post Keynesian Development Economics” to explain why much of developing world has failed to catch up to the productivity levels and consumption standards of the developed world.

ii.            Why did Pakistan’s government neither implement the IMF recommendations nor pursue proven alternative strategies? This political science question shall be answered with the help of the Gramscian tradition. Its various strands allow, on the one hand, for an understanding of the internal obstacles for overcoming the balance of payments crises and, on the other hand, the external international constraints.

The proposed research questions will be answered through a mixed methodology approach using both qualitative and quantitative data. Through semi-structured interviews, Pakistan’s repeated agreements with the IMF since 1988 would be analyzed whereas statistical data obtained from the State Bank of Pakistan would be used to analyze the economic indicators. In doing so, the thesis grapples with the economic interests of elite class structure as well as the structural adjustment programs from IMF to solve the above puzzle.