The International Monetary Fund (IMF) has projected a 27 percent inflation rate for Pakistan, a nation with a population of more than 230 million. Additionally, the global lender has warned that unemployment will continue to rise in Pakistan, which is struggling to avoid default following the destruction caused by last summer’s floods that resulted in 1,739 deaths and $30 billion in damages.

Pakistan’s current coalition government led by Prime Minister Shahbaz Sharif is in negotiations with the IMF to secure a vital tranche of a $6 billion bailout package initially agreed upon by Sharif’s predecessor, Imran Khan, in 2019. To comply with the bailout’s conditions and secure the release of the $1.2 billion portion of the deal stalled since December, the government has cut subsidies and increased taxes in recent weeks, resulting in an increase in food, gas, and power prices.

Sharif’s government has become unpopular due to rising food costs, with the prime minister blaming Khan, now the country’s opposition leader, for mismanaging the economy during his tenure. Khan was deposed in a no-confidence vote in April of last year and has since led rallies to force Sharif to agree to an early election, scheduled for later this year. There are concerns that Pakistan’s textile industry could collapse amidst these challenging economic circumstances