Part 2/9:
Pakistan's economy is heavily dependent on imports, particularly for essentials such as food, energy, and fertilizers. The nation, home to approximately 230 million citizens, has been trapped in a cycle of persistent fiscal and current account deficits. The situation worsened significantly in 2022 when the Russian invasion of Ukraine led to soaring global commodity prices, further straining Pakistan’s foreign exchange reserves.
Massive flooding in the same year exacerbated these issues, devastating agricultural output and creating an additional burden on the economy with an estimated $15 billion repair bill—equivalent to about 4% of the GDP. By early 2023, Pakistan's foreign reserves had dwindled to a dangerously low level, barely covering a few weeks’ worth of imports.