ISLAMABAD – Pakistan and International Monetary Fund (IMF) have evolved a consensus on fiscal framework, in another step for the disbursement of stalled loan tranche, as the country of over 220 million is at the verge of debt default.
The positive development comes as the coalition government takes key steps tabled by the global lender as it rolled out taxes to raise Rs170 billion.
With stringent measures in place, the two sides are likely to reach a staff-level agreement before the end of this month. It was reported that Islamabad and US-based lender held virtual meetings on Thursday and reached a consensus on negotiations.
The recent development comes amid the uncertainty in the markets after visiting mission of financial institution concluded the Pakistan visit without a staff-level agreement.
Several members of the ruling alliance including the country’s finance chief Ishaq Dar pinned hope on ongoing talks with IMF, sharing optimism about things to move forward.
The International Monetary Fund (IMF) mission chief Nathan Porter too issued a statement, confirming considerable progress made during the talks on policy measures. He also thanked the authorities for the “constructive discussions”.
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The IMF mission chief highlighted that the “key priorities include strengthening the fiscal position with permanent revenue measures and reduction in untargeted subsidies, while scaling up social protection to help the most vulnerable and those affected by the floods; allowing the exchange rate to be market determined to gradually eliminate the foreign exchange shortage; and enhancing energy provision by preventing further accumulation of circular debt and ensuring the viability of the energy sector”.
