The International Monetary Fund (IMF) has approved a $3 billion bailout package for Pakistan which will help the country avoid defaulting on its debt. This has been followed by Saudi Arabia depositing $2 billion in the State Bank of Pakistan and the UAE pledging $1 billion. China has also rolled over a $2.4 billion loan. This bailout is a temporary fix for Pakistan’s economic problems and doesn’t address the underlying issues. The government is not addressing the economy as it should and instead is using it for political purposes. The military is also heavily involved in economic matters, which leads to a lack of trust in the government. The country’s economy is struggling due to factors such as high inflation, low foreign reserves, and a weak currency. The government’s interference in the exchange rate and banking system has further damaged the economy. Additionally, over a third of the economy is undocumented, which allows for corruption and the functioning of parallel economies. The lack of investment and the volatile security situation in Pakistan also contribute to the country’s economic woes.
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