Perception management amid an unfriendly media miffed by curtailment in massive government advertisements as part of PTI government’s austerity drive, appears to be the Achilles’s heel.
PKONWEB Report (Islamabad) — The Chinese government has promised a grant of $1 billion for education, health, vocational training, drinking water and poverty alleviation projects over the next three years–for plans undertaken by the country’s new government.
China has also promised about $3.5 billion to help bolster Pakistan’s dwindling foreign cash reserves and pay for socio-economic development plans undertaken by the country’s new government.
Minister for Planning, Development and Reform Makhdum Khusro Bakhtyar said Chinese experts are scheduled to arrive in Islamabad later this month to coordinate socio-economic development under the promised grant.
Beijing will soon deposit $2.5 billion in the State Bank of Pakistan (SBP) also, raising to $4.5 billion the total amount in commercial loans China has given Pakistan this fiscal year (July 2018-June 2019), officials and diplomatic sources confirmed according to VOAnews.
Pakistan’s foreign currency exchange remains under severe pressure, despite receiving around $2 billion from China and $4 billion from Saudi Arabia and the United Arab Emirates in commercial loan deposits.
Prime Minister Imran Khan’s nascent government has embarked on a three-pronged time-scaled strategy: borrowing cash from friendly regional countries as immediate need; launching major economic reform agenda to revive the country’s crisis-ridden economy, and attract much-needed foreign direct investment.
Independent observers say nuggets of long-term results have been discernible, amid reports that forex reserves stood at $8.2 billion last week, barely enough to cover two months worth of imports.
Emergency loans from friendly countries have mainly secured a breathing space for macroeconomic stabilization measures to take root and create a business friendly environment, they said.
Khan’s team has been trying to defend what they admit are “painful reforms,” saying Pakistan’s financial woes could not be addressed without taking tough, long-overdue measures. PM Khan and his team blame alleged mismanagement and corruption by their predecessors for the ailing state of economy. The government has increased duties on luxury imports, significantly devalued the currency to encourage exports and raised prices of utility services, particularly natural gas, to generate more revenue. But perception management amid an unfriendly media miffed by curtailment in massive government advertisements–part of PM Khan setup’s austerity drive against a practice followed by their predecessors–appears to be their Achilles’s heel.
On Sunday, an agreement is expected to be signed when Saudi Crown Prince Mohammed bin Salman visits Islamabad. He was originally scheduled to begin his visit Saturday, but late Friday Pakistan’s foreign ministry announced the one-day delay without any changes to the prince’s activities in Pakistan.
The prince is expected to announce projects worth over $21 billion during his first state visit–it sets the stage for a major strategic shift in relations between the two brotherly Muslim nations. The projects include a massive oil refinery in Gwadar with an estimated investment of around $10 billion and a petrochemical complex.
In addition, 8 multi-billion dollar MoUs are to be signed in fields of water, power, investment, finance, renewable energy, internal security, media, culture,youth and sports. Three government-to-government MoUs worth billions are to be signed in oil refining, LNG and mineral development fields. Pakistan is expected to propose preferential trade agreement with Saudi Arabia.
The UAE is also working to establish an oil refinery in Pakistan and plans investments in renewables and other sectors. Malaysia, Qatar, Iran and South Korea are among other countries anxious to invest in Pakistan, officials said.
Last week, Russia signed an agreement with Pakistan for laying 1,500 km offshore gas pipeline costing $10 billion. The pipeline would transport natural gas from Russian owned-and-operated gasfields in the Middle East and Iran to Pakistan with possibility of extending it further to South Asian countries.
The World Bank President earlier this month gave her nod to PM Khan in UAE, for an economic bailout program expected to be formalized in March. Sources privy to the ongoing talks say it could be over $6 billion.
“The government’s team of professionals seems to have applied the S.M.A.R.T approach and following up things in Critical Path Method (CPM) format,” says Irshad Salim, a business strategist and financial analyst with expertise in Project Management, Contract Administration.