ISLAMABAD – The International Monetary Fund (IMF) has expressed its confidence in the measures taken by Pakistan to meet the preconditions laid forth for revival of the loan programme stalled since September last.
The positive vibes from the global lender have strengthed the hopes that the debated Staff-Level Agreement between the two sides would be signed this week, unlocking the much-needed $1.1 billion tranche of the loan under the $7billion Extended Fund Facility for Pakistan.
China recently rolled over $1.3 billion loan for the South Asian country that helped it meet a key condition of the IMF about shoring up the foreign exchange reserves.
Pakistan’s foreign exchange reserves held by the central bank rose to over $4 billion after the crisis-hit country sealed a $1.3 billion rollover from the Industrial and Commercial Bank of China.
The country of over 220 million, which is a $350 billion economy, is facing a massive economic meltdown, with a balance of payment crisis and depleting forex reserves. It is looking towards the friendly nations to secure funding amid the worsening economic situation.
Earlier, the lender’s resident representative Esther Perez Ruiz told the international media that Pakistan would be required to provide an assurance that its balance of payments deficit was fully financed for the remaining period of the IMF loan programme before the fund releases the loan tranche.
“All IMF programme reviews require firm and credible assurances that there is sufficient financing to ensure that the borrowing member’s balance of payments is fully financed over the remainder of the programme. Pakistan is no exception,” Ruiz said.
Last week, Pakistani Finance Minister Ishaq Dar claimed the external financing assurance was not one of the prior conditions of the IMF to revive the loan programme. He said that Pakistan needed $5 billion financing to bridge the balance of payments deficit in the fiscal year 2023, adding that the IMF believed the South Asian country would need $7 billion.
Imposition of surcharge on electricity bills was among the measures taken by the Pakistani authorities to tackle the circular debt in the power sector.
Pakistan set to impose 25pc luxury tax on wide-ranging items to woo IMF
