Pakistan PM Imran Khan announced today that the country’s military has decided on “unprecedented voluntary initiative of stringent cuts in its defence expenditures” due to the critical financial situation prevailing in the country.
“Despite multiple security challenges. My government will spend this money saved on development of merged tribal areas and Balochistan,” the Pakistan prime minister said on Twitter.Major General Asif Ghafoor head of Pakistan’s Inter-Services Public Relations(ISPR), the military’s media wing, added that voluntary cut in the defence budget for a year wouldn’t be at the cost of defence and security.
“We shall maintain effective response potential to all threats. Three services will manage the impact of the cut through appropriate internal measures. It is important to participate in the development of tribal areas and Balochistan,” Ghafoor said.
However, the move was criticised by Opposition PML(N) leader Maryam Nawaz Sharif who said PM Imran Khan’s announcement was “nothing but an admission of your incompetence and sheer ineptitude.”
Last month the International Monetary Fund(IMF) had agreed on a $6 billion bailout for Pakistan’s beleaguered economy. The IMF had stated that “priority” areas included improving the management of public enterprises, strengthening institutions and “continuing anti-money laundering and combating the financing of terrorism efforts”.
Pakistan has had 21 bailouts since it joined the IMF in 1950. It’s most recent loan was issued in 2013, worth $6.6 billion.
Post the bailout, the Pakistan currency had hit an all-time low as the rupee slipped over 3 per cent last month.
Pakistan is battling being blacklisted by Financial Action Task Force (FATF) due to inaction on terror financing. The Pakistan economy for the past two years has been fighting a deep balance-of-payments crisis hit by low growth, soaring inflation and mounting debt.
In recent months, Pakistan prime minister Imran Khan has travelled to China, Saudi Arabia and Malaysia in an attempt to request financial aid, although he has been promised substantial aid but it still hasn’t been enough to tide over the crisis.