SINCE 1988, Pakistan has been in 14 IMF programmes. On each occasion, without fail, the economy has achieved stabilisation similar to what it is experiencing currently. Each time, the government of the day has launched into a song and dance to celebrate an invariably short-lived achievement. More importantly, one that has come at great human cost.

This time is different, however. Not because the incumbent government has embarked on a path of serious reform that will break the country free from its continual dependence on the IMF. But because the current IMF programme is the harshest in Pakistan`s history, demanding a level of fiscal austerity that has exacted an unprecedented toll of economic devastation, misery and impoverishment. Ordinary Pakistanis have paid averyheavypriceforthe stabilisation the government is celebrating. And there is no place for their suffering in the official narrative.

A deadly combination of declining real incomes with rising unemployment and poverty, has meant that ordinary Pakistanis are in economic distress as never before. According to the government`s own statistics, from the recently published7thPopulationandHousingCensus-2023, over 18 million Pakistanis are now officially unemployed, with the jobless rate at an unheard of 22 per cent. Youth unemployment has hit an all-time high of 29pc.

Though not strictly comparable, the corresponding figure from the Labour Force Survey 2020-21, was 6.3pc or 4.5m unemployed Pakistanis recorded two years prior to the digital census. This points to a steep increase in unemployment in a short span of time.

Not surprisingly, given the widespread joblessness, the latest poverty statistics are equally alarming. According to the World Bank, nearly 45pc of the population is now below the economic waterline, of $4.2/day. Using a lower international poverty line (of $3.65/day based on 2017 PPP), an additional 12.8m Pakistanis have been pushed into poverty since 2022,for a total of over 107m citizens. As in the case of unemployment, this is very likely the sharpest increase over a two-year period in Pakistan`s history.

Placed in the context of faltering economicgrowth and an unprecedented loss in purchasing power for the average Pakistani since 2022, the foregoing statistics, however shocking on their own, are likely understating the true scale of economic misery being experienced by the masses.

Real GDP growth has averaged only 1.7pc since 2022-23, the lowest three-year average growth ever recorded since 1952 and well below the population growth rate. All the main growth engines of prosperity in the economy have sputtered since 2023. Agriculture has performed poorly, with major crops posting one of the largest declines ever recorded. The Manufacturing sector has contracted over 10pc cumulatively since 2022-23. The Services sector has grown at two-thirds its long-run average rate of growth.

No economic sector or population segment has been spared. Farm incomes have collapsed, leading to a poverty rate of 50pc in rural areas, according to the World Bank. Countless factory workers are now jobless, while middle class households across Pakistan struggle to make ends meet. Since March 2022, the purchasing power of an average Pakistani has declined by 58pc. This means anyone earning Rs50,000 per month in March 2022, now has a purchasing power of just Rs20,833.

None of this should be surprising given the nature of the IMF programme. Widespread factory closures and industrial job losses, devastation of the farm sector, and the decimation of the middle class are the hallmarks of the Fund`s anti-growth and anti-people austerity policies.

The social devastation visited upon Greece since 2010 is a glaring example. As I have previously written, despite the emphasis on social safety nets, the IMF gets the burden of adjustment of its programmes so tragically wrong.

How then can one explain the wide disconnect between the harsh daily struggles of ordinary Pakistanis set against official celebration of macroeconomic stabilisation? And the supportive, and sometimes embarrassingly gushing, endorsement from the IFIs? It is useful to remember that Pakistan has received similar endorsements from the IMF and World Bank, the sovereign credit ratingagencies and the likes of Barron`s, multiple times in the past. In each case, there is a combination of a particular set of incentives or a narrow point of view at work.

In the case of the IMF especially, there are professional as well as institutional incentives at work that can lead to over-hyping results of a programme, or condoning lapses. IMF mission chiefs and their management have every incentive to avoid a failed programme as it can be career-limiting. To do so, they can indulge in playing up programme successes, or pursue performative reforms to notch marginal wins to amplify the `success-factor` of the programme under their watch.

The institutional incentive for the IMF is to portray, as quickly as possible, both to the financial markets as well as to bilateral donors, that a programme country under its watch is now eligible for a resumption of capital flows. This also plays out via the fairly charitable and `behind the curve` debt sustainability assessments the Fund produces.

To left-leaning critics of the Bretton Woods Institutions, there is a hidden, more sinister dynamic at play. Support from the West in terms of access to funding from the IFIs, and the subsequent endorsements from the BWIs, are part of a system-legitimising re-stratification effort to consolidate the hold of Western-aligned ruling elites on power.

In Pakistan`s case, this plays out as timely and generous financial assistance, spinning a helpful narrative, facilitating political largesse and profligate spending in the budget for the past over two years while imposing austerity policies on ordinary Pakistanis. The IMF has much to answer for.

With one in two Pakistanis now below the poverty line, and nearly one in four unemployed, the state of Pakistan`s economy has never been as dismal and worrisome as over the past three years. This is the human cost of the stabilisation the government and the IMF are celebrating and sadly, glossing over. • The writer has been a member of several past economic advisory councils under different pn~me ministers.