The recently formed ruling alliance is facing delays in finalizing its finance minister, a crucial position tasked with leading immediate negotiations for a new International Monetary Fund (IMF) bailout, sources familiar with the discussions revealed.
Pakistan’s struggling $350 billion economy is on a narrow path to recovery, and the current IMF agreement is set to expire on April 11. External financing avenues crucial for the country’s economic stability are contingent on securing another extended IMF program.
The primary contender for the finance minister role is Ishaq Dar, a former four-time finance minister from the Pakistan Muslim League-Nawaz (PML-N) party, which leads the coalition. However, Dar is not the sole candidate under consideration. Despite being a close aide to PML-N chief Nawaz Sharif, Dar has faced criticism for his previous handling of the economy in the last coalition government.
Dar defended his actions, stating that he took tough measures to avert a sovereign default by securing the IMF program, which former Prime Minister Imran Khan had allegedly scuttled. Political allies, however, have raised concerns about Dar’s approach.
If Dar doesn’t secure the finance minister position, there is speculation within the PML-N party that a deputy prime minister role could be created for him.
Other candidates under consideration include caretaker Finance Minister Shamshad Akhtar, a former central bank governor praised by the IMF for decisive policy efforts. Muhammad Aurangzeb, president and CEO of Habib Bank Limited, who also served as CEO of JP Morgan’s Global Corporate Bank in Asia, is another contender.
The PML-N, leading a minority government, will need support from various parties to pass critical legislation. Managing public anger over record inflation and preparing a federal budget that balances tough reforms with economic rejuvenation will be key challenges for the new finance minister.
Yousuf Nazar, a London-based economist and former Citigroup banker, emphasized the need for someone with broad international experience to introduce reforms. However, he refrained from indicating the best-suited candidate.
Despite earlier reports suggesting the new finance minister would be from the PML-N, recent information contradicts this, with Aurangzeb’s name surfacing as a potential candidate. The final decision is expected after the election scheduled for March 3, where PML-N’s Shehbaz Sharif has been nominated for prime minister.
