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Economist says inflation may go up due to bad deal with IMF.

KARACHI -- Economist Dr Kaiser Bengali warned on Monday that inflation in the country was feared to go as high as 20 per cent in coming days 'because of the wrong policies of the government under which it has dealt with the International Monetary Fund.

'More people will lose their jobs and inflation will further rise because the government has surrendered to the IMF to seek its bailout package,' said Dr Bengali while delivering a lecture titled 'Deal with IMF: economical and political slavery trap' organised by the National Trade Union Federation and Home Based Women Workers Federation.

Dr Bengali, who has advised both the federal and provincial governments on economic matters, claimed the federal government had already gone bankrupt and said 'it does not have dollars in its foreign exchange reserves nor it seems to have overcome the trade deficit challenge yet'.

He said the country's exports stood at $24 billion against the imports of $60bn and 'there is no other way out except adopting public-friendly policies to successfully endure the current economic [situation]'.

'IMF has no sympathy with the public. It, like all the banks, is only interested in getting its money back,' he said.

He added the government's practices and policies were similar to those of retired Gen Pervez Musharraf's regime.

He said the then prime minister and finance minister were brought in from aboard and the same had been done by the present government vis-a-vis the appointment of the finance minister and governor of the State Bank of Pakistan.

Dr Bengali said that when a company, which owed banks heavily went bankrupt, banks took that entity over.

'In the case of Pakistan,' he added, 'the equation is not different as the IMF has put its representatives on key positions to recover its money'.

Criticising the government, he said there were around 14 to 15 ministries which were unnecessary and gave example of one national harmony ministry and wondered what its significance was. 'Instead of cutting its own expenses, the government is putting burden on public.'

Citing research, he said that people tended to drink tea instead of having a proper meal because it would cost them more. The elite, on the other hand, had been unaffected by inflation, he said.

He said that economic crisis was also caused by the elite class because they preferred imported goods to local ones. 'The elites want European lifestyle while living in Pakistan,' he said.

He said that trade deficit needed to be reduced to overcome the current economic upheaval. Still, he added, the government's policies were unfriendly in encouraging exports and discouraging imports.

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Publication:Dawn (Karachi, Pakistan)
Geographic Code:9PAKI
Date:Jun 4, 2019
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