Page 5 - Economic Crisis

Sri Lanka returns to non-stop power supply after a year, at higher cost

After a year of load-shedding, Sri Lankans will get continuous power from Thursday, albeit with a hike in tariff in line with the conditions set by the IMF. The Sri Lankan government's move comes as the debt-hit country aims to secure a much-needed USD 2.9 billion tranche from the Washington-based global lender. President Ranil Wickremesinghe has directed officials to ensure an uninterrupted power supply to customers after the tariff revision is implemented, a statement from the President's Media Division said. The state power entity said that the power cuts ranging from one to 14 hours from January last year would end on Thursday. A 66 per cent tariff hike would be in effect, the second in the last six months. A 70 per cent rate increase was introduced in August last year. The government opted for a cost-reflective tariff plan as dictated by the International Monetary Fund (IMF), Energy Minister Kanchana Wijesekara said. This will be a giant step in securing the IMF facility, he

A profligate state: The financial cul-de-sac that confronts Pakistan

With a narrow industrial base and dysfunctional politics, and a counter-productive national security agenda, Pakistan could well remain an "international migraine", writes T N Ninan

Inflation, loans, forex balance: The many crises for Pakistan's economy

Without a bailout package from IMF and support from others, India's neighbour will be pushed deeper into the abyss

Pak's deepening political-eco crisis may spill over into region: Experts

As dwindling forex reserves, nationwide power outages, stampedes at state-run food distribution centres and a Pakistani rupee, which plunged nearly 50 per cent in a year to 260 to the US dollar on Monday, propels the neighbouring country towards being an international "basket case", Indian analysts believe there could be serious consequences for the region. Amid this economic crisis, the Shahbaz Sharif government will begin crucial negotiations with the Washington-based IMF (International Monetary Fund) for a bail-out package on Tuesday which may come with "tough and possibly politically risky" pre-conditions of austerity, feeding into a bigger political crisis, they said. The risk for India would not only be instability in Pakistan with its fall-out of rising extremism in the region but also unpredictable actions which could include bids to divert domestic public attention by focussing on an external enemy. "The current economic crisis is feeding into the ongoing political crisis .

Pakistani rupee tumbles to all-time low against USD amid IMF condition

Following the rupee's devaluation in the open and interbank markets, the benchmark index of the Pakistan Stock Exchange (PSX) rallied and gained by more than 1,000 points, as per media reports

Pak economic crisis: 10% cut in govt employees' salary under consideration

Pakistan is considering different proposals, including slashing the salaries of government employees by 10 per cent across the board, according to a media report on Wednesday, amidst the looming economic crisis in the cash-strapped country. Pakistan is grappling with one of the country's worst economic crises in recent years amid dwindling foreign exchange reserves. The National Austerity Committee (NAC) constituted by Prime Minister Shehbaz Sharif is considering different measures, including cutting down the salaries of government employees by 10 per cent across the board, Geo News reported. The NAC is also considering cutting down expenditures of ministries/divisions by 15 per cent, reducing the number of federal ministers, ministers of state, and advisers from 78 to 30 only while the remaining should work on a pro bono basis, the report said. The recommendations would be finalised on Wednesday and the committee will send the report to prime minister Shehbaz. The government is

Debt-ridden Sri Lanka thanks India for backing its $2.9 bn bailout package

Debt-ridden Sri Lanka on Wednesday thanked India for issuing the necessary guarantees sought by the IMF that would help Colombo to unlock the USD 2.9 billion bailout package. India's ministry of finance recently issued a letter to the International Monetary Fund (IMF) to confirm its support to Sri Lanka on the issue of debt restructuring. Also, External Affairs Minister S Jaishankar during his recent visit to Colombo gave the required assurances to Sri Lanka's top leadership for the much-needed IMF bailout package, becoming the first major lender to publicly back the island nation's efforts to recover from its worst-ever economic crisis. In a statement on Wednesday, the Governor of the Central Bank of Sri Lanka Nandalal Weerasinghe thanked India for issuing the necessary guarantees warranted by the IMF for unlocking the USD 2.9 billion bailout for the country. "India has clearly given financial assurances which are acceptable to the IMF..which has all the necessary assurances ..fir

FAO: Rising prices, population, food insecurity add to ranks of hungry

Growing numbers of people in Asia lack enough to eat as food insecurity rises with higher prices and worsening poverty, according to a report released Tuesday by the Food and Agricultural Organisation and other United Nations agencies. Nearly a half-billion people, more than eight in 10 of them in South Asia, were undernourished in 2021 and more than 1 billion faced moderate to severe food insecurity, the report said. For the world, the prevalence of food insecurity rose to more than 29 per cent in 2021 from 21 per cent in 2014. The COVID-19 pandemic was a huge setback, causing mass job losses and disruptions, and the war in Ukraine has pushed up prices for food, energy and fertiliser, putting an adequate diet out of the reach of many millions, it said. The report is the fifth annual stocktaking on food insecurity and hunger by UN agencies including the FAO, UNICEF, World Health Organisation and World Food Programme. Over those years, progress toward alleviating hunger and ...

Electricity supply restored incrementally in Pak after nationwide outage

Electricity supply was restored incrementally in Pakistan on Tuesday after a nationwide power breakdown left millions of people without electricity amidst fears of default and looming economic meltdown due to a balance of payment crisis in the country. The massive power blackout on Monday was the second such outage in nearly four months. Today, at 5:15 am, the system was completely restored across the country, Energy Minister Khurram Dastgir said. However, major cities, including Karachi, Quetta and Lahore, remained deprived of power, the Dawn newspaper said. Dastgir said that approximately 6,600 megawatts of coal and 3,500MW of nuclear plants would take an estimated 48 to 72 hours to restart. Until these plants start running, there will be limited load management, excluding industrial users, he was quoted as saying by the paper. The minister added that there was no fuel shortage in the country. We are considerate of the electricity bills people have to pay and try not to ...

Pakistan has 'technically' defaulted with continuous loan rollovers

While Pakistan has not officially defaulted, but with continuous rollovers of loans that have come from China, Saudi Arabia, and the UAE among others, the country has already done so 'technically'

Amid deepening food crisis in Pakistan, people chase wheat truck on bikes

In a video shared on social media, some people riding a motorcycle are seen chasing a truck carrying sacks of flour, and people can be seen chasing the vehicle to buy the lot

Only option is to seek IMF support: SL President on economic collapse

'The only option we have now is to seek the support of the International Monetary Fund (IMF). Otherwise, we cannot recover'

Sri Lanka concludes debt restructuring talks with Japan: Wickremesinghe

Sri Lanka has concluded debt restructuring talks with Japan and will continue to hold such meetings with India this month, President Ranil Wickremesinghe announced on Saturday, as the cash-strapped country looks to carve a path out of its worst financial crisis. The crisis-hit island nation, which is trying to secure a USD 2.9 billion bridge loan from the International Monetary Fund (IMF), has been trying to get financial assurances from its major creditors China, Japan and India which is the requisite for Colombo to get the bailout package. The IMF bailout has been put on a halt as Sri Lanka pursues talks with creditors to meet the global lender's condition for the facility. Addressing trade unionists here, the president said that the debt restructuring talks with China's Exim bank were held this week and further dialogue is in progress. On January 19, the Indian foreign minister is expected to visit and we will continue to have debt restructuring talks with India, Wickremesingh

Sri Lanka to implement cost-reflective tariff formula for electricity

Amid the ongoing economic crisis, Sri Lanka's cabinet of ministers has approved the implementation of a cost-reflective electricity tariff formula

Sri Lankan economy to recover in second half of 2023: Central bank

The central bank said that structural economic impediments that existed across various spheres of the economy over decades were compounded by economic shocks, along with ill-timed policy choices

UN assures economic crisis-hit Sri Lanka with financial, technical support

The UN official made the remarks on Wednesday at a meeting between Sri Lankan President Ranil Wickremesinghe and a delegation he headed

Pakistan orders shopping malls to close early amid economic crisis

Authorities on Wednesday ordered shopping malls and markets to close by 8.30 pm as part of a new energy conservation plan aimed at easing Pakistan's economic crisis, officials said. The move comes amid talks with the International Monetary Fund. On Tuesday, Pakistan Defence Minister Khawaja Mohammad Asif and Minister for Power Ghultam Dastghir said the government decided to shut establishments early as part of the new energy conservation plan approved by the Cabinet. Authorities also ordered wedding halls and restaurants to shut at 10 pm. The government expects these measures to save energy and curtail the costs of imported oil, for which Pakistan spends USD 3 billion annually. In Pakistan, most of the electricity is generated by using imported oil. So far, there has been a mixed reaction from representatives of shopping malls, restaurants and shop owners who want the government to reverse the decision. Many Pakistanis do their shopping and dine at restaurants as late as ...

The New Year looks decidedly gloomy in India's political neighbourhood

Three key countries with which India has economic ties - Sri Lanka, Bangladesh and Nepal - are facing risks that appear to be worsening

Gold may touch new high of Rs 62,000 this year on back of dollar weakness

Brokerages expect upside on hedging demand amid global slowdown risk

Google staff braces for a cost-cutting drive as budgetary anxiety mounts

A letter signaled how some Google employees are increasingly interpreting recent management decisions as warnings that the company may be angling to conduct broader layoffs