The rare and candid admission underlined Pakistan’s deepening economic distress and came during Sharif’s address to top Pakistani exporters in Islamabad on Friday night.
‘Reserves have doubled’ — but on borrowed money
Sharif claimed that Pakistan’s foreign exchange reserves had “almost doubled,” but conceded that the apparent improvement was largely due to loans from friendly countries rather than organic economic strength.
“The current situation is that the reserves of the foreign exchange have almost doubled. But the loans of our friends and countries are included. You know that the one who goes to take a loan, his head is bowed,” Sharif said.
‘We are ashamed’: PM admits loss of self-respect
In a striking confession, Sharif described seeking foreign loans as humiliating and said it had come at the cost of national self-respect.
“We feel ashamed when Field Marshal Asim Munir and I go around the world begging for money. Taking loans is a huge burden on our self-respect. Our heads bow down in shame. We cannot say no to many things they want us to do,” he said, underscoring Pakistan’s weakened negotiating position.
IMF talks continue amid strict conditions
The remarks come as Pakistan remains in active discussions with the International Monetary Fund over measures to support economic growth after imposing strict stabilisation policies. Sharif said his government has instructed the central bank and the finance ministry to improve access to capital and support industrial growth.
Pakistan recently received $1.2 billion from the IMF under its ongoing loan programme and a separate climate-related financing arrangement. While the funds have helped Islamabad meet debt obligations and shore up reserves, they come with conditions requiring tight monetary policy and controlled spending.
Central bank holds rates despite inflation risks
Earlier this week, the State Bank of Pakistan unexpectedly kept its key interest rate unchanged at 10.5 percent, citing concerns that inflation could rise, even as it projected GDP growth of 3.75 to 4.75 percent for the fiscal year ending June.
The central bank has forecast that foreign exchange reserves could cross $20 billion by December, a target still heavily dependent on continued external financing.
Reliance on ‘friendly countries’
Sharif acknowledged Pakistan’s reliance on external assistance, praising China as an “all-weather friend” and thanking Saudi Arabia, the UAE and Qatar for their financial support.
China has rolled over billions of dollars in deposits, with $4 billion expected in 2024–25. Saudi Arabia has extended a $3 billion deposit along with an oil facility, while the UAE rolled over a $2 billion loan. Qatar has signed plans involving $3 billion in investments and LNG supplies.
Debt, poverty and joblessness persist
Sharif raised concerns over poverty, unemployment and weak innovation, admitting that Pakistan’s structural problems remain unresolved. Public debt has crossed Rs 76,000 billion, poverty levels remain high, unemployment affects millions, and the country continues to rely heavily on IMF programmes and foreign loans to stay afloat.
