Pakistan economic losses from IMF policies reach $148 billion, claims former adviser

Dr. Ashfaque Hassan Khan, former Economic Adviser to the Ministry of Finance, has claimed that IMF-mandated structural adjustment programs have cost Pakistan approximately $148 billion over a five-year period. He noted that this economic loss exceeds the roughly $130 billion the country sustained during the 13-year War on Terror.

Khan criticized the current monetary policy, arguing that high interest rates are ineffective against Pakistan’s supply-side inflation, which is driven by rising energy tariffs, indirect taxes, currency devaluations, and increased food and fuel costs. He stated that while monetary tightening aims to reduce demand, it cannot address cost-push factors like wheat prices or global fuel costs.

Furthermore, the economist warned that aggressive monetary tightening increases the federal government’s domestic debt servicing costs and suppresses industrial growth. He advocated for a shift toward supply-side reforms and domestic productivity enhancements to break the cycle of multilateral bailouts.