Ihtesham ul Haq

University of Kassel (UKS, Germany)

2 - Partnership in the Global Economy– Finance

Prof. Dr. Christoph Scherrer

Pakistan's Repeated Balance of Payments Crises and Drawdowns on IMF Loans

For three decades, Pakistan has been grappling with a balance of payments crisis, dwindling foreign exchange reserves, and recurring budget deficits. Consequently, the country regularly turns to the IMF to manage the crisis, yet it has failed to break free from the “beggar-thy-neighbor trap.” For this reason, in-depth studies and research are necessary to determine whether Pakistan’s economic problems stem from the country’s domestic and foreign economic structures or are attributable to externally imposed agendas, and to answer the following research questions:

• Why has the Pakistani government failed to overcome the balance of payments crisis resulting from IMF loans and conditions? This will be analyzed in light of “post-Keynesian development economics” to explain why the majority of developing countries have failed to reach the productivity levels and consumption standards of industrialized nations.
• Why has the Pakistani government neither implemented the IMF’s recommendations nor pursued proven alternative strategies? This political science question will be addressed using the Gramsci tradition. Its various strands allow for an understanding of both the internal obstacles to overcoming balance-of-payments crises and the external international constraints.

The proposed research questions will be addressed using a mixed-methods approach that draws on both qualitative and quantitative data. Semi-structured interviews will be used to analyze the agreements Pakistan has repeatedly concluded with the IMF since 1988, while statistical data from the State Bank of Pakistan will be used to evaluate economic indicators. In doing so, the study examines the economic interests of the elite class structure as well as the IMF’s structural adjustment programs in order to solve the aforementioned puzzle.

• October 2015–November 2017: Master’s degree in “Good Governance,” University of Passau
• January 2012–May 2012: Exchange semester during my bachelor’s program at Kennesaw State University, Georgia, USA
• September 2009–December 2013: Bachelor’s degree in Political Science, University of Peshawar

• April 2019–August 2019: Research Assistant, DAAD-STIBET Doctoral Program, University of Kassel, Kassel, Germany
• January 2018–October 2018: Research and Policy Analyst, Direct Focus Community Aid (DFCA), Peshawar, Pakistan

• January 2012: Exchange program for undergraduate students, funded by the United States Education Foundation in Pakistan, for one semester at Kennesaw State University, Georgia, USA
• May 2013: Gold medal for outstanding academic achievement during my undergraduate studies at the University of Peshawar, Pakistan
• April 2015: DAAD scholarship for a master’s degree in Public Policy and Good Governance at the University of Passau, Germany