Pakistan’s Prime Minister, Shehbaz Sharif, has requested his ministers and advisers to relinquish their salaries, benefits, luxury cars, and fly economy class as part of an austerity drive to save the government Pakistani Rupee (PKR) 200 billion a year.
The cuts are part of an effort to prevent an economic crisis in the country as the State Bank’s foreign exchange reserves have fallen below a three-week import cover, and inflation remains consistently high. The belt-tightening comes as the government is attempting to resume a stalled loan programme of the International Monetary Fund (IMF) to secure funds worth USD 1 billion.
The Prime Minister stated that the measures wouldn’t provide significant, immediate relief, but they would give people a sense that the government acknowledges their pain and agony. The decisions included the removal or reduction of salaries, security vehicles, perks, and privileges of cabinet members. There would be a ban on the import of luxury items and official vehicles for over a year, fewer foreign visits, and a ban on cabinet members staying in five-star hotels.
The opening of government offices at 7:30 am to save electricity and gas, selling spacious houses given to government officers, and allowing only one official plot for a government employee were also announced. The Prime Minister further stated that “additional steps” would be taken at the time of the budget for the new fiscal year. A 15% cut in expenses of government institutions and a reduction in non-combat expenditure of armed forces was also announced.
The current situation in Pakistan is the most challenging faced by the country in the last two decades, with an economic crisis, political chaos, and a rising number of terror attacks along the northwestern areas.
In December 2022, inflation in the country stood at 24.5%, almost double of 12.3% from the previous year. The common people were the most affected by the high flour prices amid the country’s worst-ever food crisis, according to reports. However, the Prime Minister believes that these austerity measures will save around over PKR 200 billion and provide a sense of relief to the people, even if it is not immediate.
Overall, the austerity measures taken by Shehbaz Sharif are aimed at addressing the economic crisis in Pakistan and resuming the stalled loan programme of the IMF. The Prime Minister has also urged his ministers and advisers to set an example for the rest of the nation and contribute to the country’s well-being.
(Photo credit: @CMShehbaz)
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