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Human Rights Watch (HRW) on Monday called on the International Monetary Fund (IMF) to work with Islamabad and minimize the direct and indirect impact of its conditionalities on low-income Pakistanis.
In an open letter on the ongoing negotiations—commencing on Feb. 1 and continuing through Feb. 9—between Islamabad and the IMF for the revival of a stalled bailout, the global rights body warned that Pakistan was already in the midst of “one of the worst economic crises in its history” that was jeopardizing millions of people’s rights to health, food, and an adequate standard of living. To counter this, it said, the global lender should work with Pakistan to protect the economically disadvantaged by broadening social protection systems and minimizing reform measures that risk further harm to the most vulnerable people.
“Millions of Pakistanis have been pushed into poverty and denied their fundamental social and economic rights,” said Patricia Gossman, associate Asia director at Human Rights Watch. “The IMF and the Pakistani government have a responsibility to address this crisis in a way that prioritizes and protects low-income people,” she added.
Noting that at least a quarter of Pakistan’s population was already living below the poverty line before the economic crunch, HRW praised the Benazir Income Support Program (BISP)’s targeted handouts, but said it needed to be expanded significantly to protect large segments of the population from the “added burden of potential additional IMF-mandated measures raising prices for necessities.”
Stressing that Pakistan was a party to the International Covenant on Economic, Social and Cultural Rights that protected the rights to health, food, housing, and an adequate standard of living, the HRW said the IMF’s tough conditionalities could “either exacerbate social and economic hardship or provide desperately needed relief to Pakistanis while addressing the crisis’s underlying causes.”
Among the conditions the IMF is reportedly seeking, said the HRW, are the removal of all energy and fuel subsidies; a market-based exchange rate; and a higher general sales tax. However, it said, a depreciating local currency, skyrocketing inflation, and the easing of subsidies had already made it difficult for people to meet their basic needs and introducing even more taxes would merely “hit hardest on the people already most heavily affected.”
Calling on the IMF to conduct a thorough assessment of the direct and indirect impact its adjustments would have on low-income people and adequately mitigate them, the HRW said part of the anticipated savings from budgetary cuts should be used to strengthen social safety nets by including a structural benchmark to significantly broaden coverage and increase social spending. “The IMF should urge Pakistan’s government to enact policies to increase women’s access to employment by reducing barriers, including by providing state-funded maternity leave and access to affordable menstrual hygiene,” it added.
The rights body also advocated “progressive” taxes that do not exacerbate inequality and increase the cost of living in ways that undermine rights. “Any cuts in subsidies for electricity, fuel, and natural gas should be preceded by a comprehensive reform plan that ensures everyone is able to access energy supplies essential for basic rights,” it said, saying government spending should focus on education, health care, and poverty-reduction programs. “The IMF should use its procedures to make needed funds available as soon as possible, putting into place safeguards to protect people’s economic and social rights,” it added.
“Pakistan’s government should use the influx of funds to expand support for those worst-affected by the economic crisis,” Gossman said. “The IMF should provide Pakistan the time and flexibility to achieve a sustainable, inclusive, and rights-based recovery,” she added.