The options and solutions being adopted are highly controversial, and unless accompanied by appropriate actions, could carry moral hazard and loss of tax payer’s money. In the context of Pakistan, the diagnosis is different.
So rather than facing a financial crisis, Pakistan is caught in a complex macroeconomic problem as twin deficits rose to unprecedented proportion in fiscal year 2007/2008 which remained unattended for some period. Being an open and highly import dependent economy, Pakistan has been hit aggressively by the surge in global commodity prices whose impact magnified as the oil and other strategic import prices rose.