Pakistan, IMF agree to continue deliberations over bailout program

Pakistan, IMF agree to continue deliberations over bailout program
Pakistan's Prime Minister Imran Khan speaks during the World Government Summit in Dubai, United Arab Emirates, on Sunday, Feb. 10, 2019. (AP)
Updated 10 February 2019

Pakistan, IMF agree to continue deliberations over bailout program

Pakistan, IMF agree to continue deliberations over bailout program
  • Christine Lagarde says IMF stands ready to support Pakistan
  • Saudi Arabia, UAE’s financial assistance made Pakistan comfortable to deal with the Fund

ISLAMABAD: Prime Minister Imran Khan and Managing Director of the International Monetary Fund (IMF) Christine Lagarde agreed in a meeting on the sidelines of World Government Summit in Dubai on Sunday to continue talks for a bailout package.

“The two sides agreed to work together on policy priorities and reforms aimed at reducing imbalances and laying the foundations of a job creating growth path in Pakistan,” Dr. Khaqan Hassan Najeeb, Spokesperson for the Ministry of Finance, told Arab News shortly after the meeting.

He said the deal on the IMF support package was yet to be reached and “deliberations between the Pakistani authorities and IMF staff will continue to finalize an agreement on the contours of a program.”

Pakistan government has been negotiating a deal with the IMF since November last year to shore up the country’s dwindling foreign exchange reserves and avert the possibility of a balance-of-payments crisis. But the agreement is yet to be reached due to “tough economic conditions” suggested by the Fund before it offers financial assistance.

Finance Minister Asad Umar has repeatedly said that Pakistan would sign the financial deal with the IMF only if it “gets the loan on favorable conditions.”

In the meeting with the IMF chief, Prime Minister Khan vowed to undertake “structural and governance reforms and strengthen social protection in the country.”

Meanwhile, a press release issued by the IMF said that Lagarde had a “good and constructive meeting with Prime Minister Imran Khan.”

“We discussed recent economic developments and prospects for Pakistan in the context of ongoing discussions toward an IMF-supported program,” Lagarde was quoted as saying in the statement.

“I reiterated that the IMF stands ready to support Pakistan,” she said, adding that “decisive policies and a strong package of economic reforms” would enable Pakistan to restore the resilience of its economy and lay the foundations for stronger and more inclusive growth.

Citing the PTI government’s policy agenda, Lagarde said protecting the poor and strengthening governance were “key priorities to improve people’s living standards in a sustainable manner.”

On the other hand, senior economist Dr. Ayub Mehr said that “the highest-level meeting” between Prime Minister Khan and IMF chief showed that work on “operations level” of the financial agreement had been completed.

“Pakistan is in a dire need for a financial package from the IMF to overcome its liquidity crisis and bring a financial discipline to improve its economy,” he told Arab News. “And we have already met most of the IMF conditions like rupee devaluation to get the package,” he added.

Pakistan was faced with a financial deficit of around $12 billion when the PTI government took charge of the office in August last year, but the situation has changed now, Dr. Athar Ahmed, senior economist, said.

“The government is now in a comfortable position after the availability of $6 billion direct cash assistance ($3 billion each) from Saudi Arabia and the UAE, and is now trying to negotiate a better deal with the Fund,” he told Arab News.

“We are definitely going to get a financial package from the Fund, but on conditions that would not harm our economic growth and burden the poor through sharp hike in electricity and gas tariffs,” he added.


'No food left in the sea': Pakistani fishermen fearful as Chinese trawlers dock at Karachi port 

'No food left in the sea': Pakistani fishermen fearful as Chinese trawlers dock at Karachi port 
Updated 19 October 2020

'No food left in the sea': Pakistani fishermen fearful as Chinese trawlers dock at Karachi port 

'No food left in the sea': Pakistani fishermen fearful as Chinese trawlers dock at Karachi port 
  • Fisherfolk forum says government plan to allow Chinese to carry out deep-sea fishing in territorial waters could render millions jobless 
  • Federal government says bottom trawling will not be allowed under new fishing policy

KARACHI: A pressure group that represents Pakistani fishermen has said a government plan to allow Chinese companies to carry out deep-sea fishing in the country’s territorial waters could threaten the survival of at least three million people who depend on the sea for livelihood.
Last month, 12 Chinese deep-sea trawlers docked at the port of Karachi, unleashing fear among local fishermen who say commercial fishing vessels and bottom-trawling would deplete fish stocks in the exclusive federal sea zones off the Sindh and Balochistan provinces. 
Bottom trawling - dragging nets across the sea floor to scoop up fish - stirs up the sediment lying on the seabed, displaces or harms some marine species, causes pollutants to mix into plankton and move into the food chain and creates harmful algae blooms or oxygen-deficient dead zones.
The coastal line of Sindh and Balochistan is 1,050 km long, Mohammad Ali Shah, Chairman Pakistan Fisherfolk Forum, told Arab News last week, saying around three million fishermen relied on the sea to survive. 
A new fishing policy is expected but yet to be revealed by the government, he said. 
“The deep-sea trawler policy has not yet been approved but before that they [China] have brought these trawlers,” Shah said, calling the arrival of the Chinese vessels at Karachi port last month ‘illegal.’ 

In this undated photo, fishing vessels of Fujian Fishery Company move from the Gwadar port towards Karachi, Pakistan (Photo courtesy: Fishermen Cooperatives Society)

In 2018, the government enacted a deep-sea fishing licensing policy that both fishermen's representative bodies and provincial government bodies opposed, calling it a constitutional violation and an encroachment on the livelihoods of fishermen in the coastal provinces.
Fears about foreign fishing companies eating up local communities are not new.
For years, fishermen in the southwestern city of Gwadar in Balochistan province - a flagship of the $60 billion China-Pakistan Economic Corridor - have protested against foreign trawlers. 
Tensions first began to mount when the Fisheries Department disclosed its plan to issue licenses to various foreign fishing vessels to operate in an exclusive economic zone in 2016.
But last week, the federal minister for maritime affairs, Ali Haider Zaidi, told Arab News the country’s new deep-sea fishing policy would not allow Chinese trawlers to engage in unregulated deep-sea fishing. Bottom trawling, he said, would be banned under the new policy.
“Importing boats is not illegal,” he said. “How you use them has to be regulated.”
Pakistan divides its sea into three zones, where zone-3 (from 20 to 200 nautical miles) is controlled by the federal government. Up to 12 nautical miles (zone-1) is the domain of the provinces Sindh and Balochistan and between 12 to 20 nautical miles the sea is declared a buffer zone. 

Fishermen remove fish from a net at the Clifton beach in Pakistan's port city of Karachi on Oct. 6, 2020. (AFP/File)

Local fishermen are not allowed to fish in zone-3 and foreign fishing vessels are not permitted to fish in the other two zones under the existing policy.
The Fishermen's Cooperative Society (FCS), which issued the permit to the Chinese trawlers, said the Chinese fishing vessels would not use the destructive bottom trawling method and instead help ‘upgrade’ Pakistan’s fishing industry and export.
Official figures put the annual value of Pakistan’s fish exports at roughly $450 million.
“Bringing Chinese trawlers for deep sea fishing is in line with the government’s deep-sea fishing policy and aimed at upgrading and modernizing fishing, besides providing job opportunities to local fishermen,” Abdul Berr, Chairman of the Fishermen's Cooperative Society, told Arab News.
“Around 3,500 fishermen will get employment opportunities with the arrival of the world’s latest fishing boats and modern small boats,” Berr said. 
He added: “First, 70 percent of the staff at trawlers and processing facilities will be local. There will be no fishing in provincial territorial waters. The trawlers will bring all their catch to Karachi where it will be processed in factories and then exported.”
Small local fishermen would receive modern fiber boats on ‘easy instalments,’ Berr said, a step towards replacing their obsolete boats.
But Sindh’s minister for livestock and fisheries, Abdul Bari Pitafi, said the mega fishing ships would wipe out sea-life, even if they were only operating in the federal government’s zone-3.
“We will...also oppose its [trawlers’] operations in zone-3 because they will just wipe out sea-life including the fish’s seed,” Pitafi told Arab News.
In 2016, a survey carried out by the Food and Agriculture Organisation revealed that more than 72 percent of the fish stock in Pakistan’s coastal areas had already declined.
“One trawler does a catch that is equal to a catch by 100 of our fishing boats,” Younus Khaskheli, a fisherman, said. “And their fishing net is the most dangerous one, because it hunts thousands of tons of fish.” 
Tens of thousands of fishing boats are registered in Pakistan, he said, with fishermen from Sindh, Balochistan, Punjab, Khyber Pakhtunkhwa and even Bangladesh fishing in these waters.
“Our sea stock will end; the country will lose the income of billions and our fishermen will become jobless,” Khaskheli said. “There won’t be any food left in the sea.”