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Pakistan crisis: 10% cut in govt salaries, 15% cut in ministries’ expenditures part of austerity measures

Pakistan crisis: 10% cut in govt salaries, 15% cut in ministries’ expenditures part of austerity measures

Pakistan economic crisis: The National Austerity Committee (NAC), formed by Prime Minister Shehbaz Sharif, is considering a host of measures including cutting government salaries by 10 per cent.

Pakistan crisis: PM Shehbaz Sharif forms an austerity committee Pakistan crisis: PM Shehbaz Sharif forms an austerity committee

Pakistan, as part of its austerity measures, is mulling slashing salaries of government employees, reducing the count of federal ministers and curbing the expenditure of ministries and divisions. This comes as the Pakistani economy struggles to cope with mounting debt, global inflation and political instability, and has been pushed to the brink of a collapse.

The National Austerity Committee (NAC), formed by Prime Minister Shehbaz Sharif, is considering a host of measures including cutting government salaries by 10 per cent. The proposals also include cutting down expenditures of ministries and divisions by 15 per cent. It also aims to reduce the number of federal ministers, ministers of state and advisers from 78 to 30. The remaining, it suggested, should work on a pro bono basis, according to a report by UAE-based news site Geo News. 

The final report was scheduled to be sent to PM Sharif by Wednesday. 

The Pakistani government is also seeking another monetary tranche from the International Monetary Fund (IMF). However, the IMF has refused to send a team to the country to complete the review for the $1.18 billion fund, part of the $6 billion bailout package Islamabad secured in 2019. 

Moreover, the IMF wants the country to carry on a slew of reforms that Pakistan cannot afford as of now. Both sides are still discussing the demands that the IMF wants from Islamabad, as per reports. Pakistan PM Sharif fears that implementing these demands would hike up the price of essential items and might also cost him the upcoming national elections. 

The NAC also recommended utilising funds for provincial nature projects and imposed a ban on public sector enterprises from securing loans through government guarantees. It also considered a proposal to freeze discretionary funds of intelligence agencies, including Inter-Services Intelligence (ISI) and Intelligence Bureau (IB). 

The committee also considered a ban on buying of luxury vehicles, freezing perks and privileges locally and abroad of ministries and divisions. 

Also read: Big setback for flood-ravaged Pakistan seeking funds from IMF

Published on: Jan 26, 2023, 9:47 AM IST
Posted by: anwesha madhukalya, Jan 26, 2023, 9:43 AM IST