Pakistan’s inflation overtakes Sri Lanka – what does it signify?

The world witnessed Sri Lanka’s economic collapse last year, which caused complete chaos within the country. But Sri Lanka is not the only country that has impacted the South Asian region’s economic stability; many experts believe that Pakistan is on the brink of economic collapse as well. Pakistan’s inflation surpassed Sri Lanka’s yesterday which has further added to these concerns. While Sri Lanka’s inflation rate has dropped to 35.3% from 50.3%, Pakistan’s inflation has risen to a record 36.4%. But what does it mean for Pakistan’s future?  

The country has piled up decades of loans from the International Monetary Fund (IMF), World Bank, China, Saudi Arabia and other countries besides the billions of dollars worth of aid received by the United States. It has historically been in political instability as no government has ever completed a full term of five years. Many citizens are struggling to acquire basic food necessities and essentials, which is increasing agitation among people. There is a growing belief among think tanks that Pakistan may default soon; and if this situation continues to worsen, then the country may even potentially face a civil war.