IMF seeks more details on budgetary position from Pakistan

IMF - The News Today - TNT

ISLAMABAD: The International Monetary Fund (IMF) has asked additional information about the budget and other areas from Pakistan before beginning virtual negotiations, amid the country’s urgent need to generate $10 billion in foreign loans for the remainder of the current fiscal year to prevent default.

The remaining loan repayment requirements and external financing of managing current account deficit to the tune of $8 to $10 billion cannot be raised without backing and revival of the stalled IMF programme, a government official said, adding that the IMF sought some additional information that they were just sitting in the Finance Ministry for responding back to the IMF tonight.

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Meanwhile, the government is all set to table its plan to erase the circular debt of gas sector before the upcoming meeting of the federal cabinet by hiking gas tariff and bringing changes in the existing slabs to fulfil the IMF condition.

Earlier, Pakistan shared the contours of areas for accomplishing the pending 9th review under the $7 billion Extended Fund Facility (EFF). Now the IMF has sought more details on the budgetary position which would be shared with the global lender soon.

On other hand, Pakistan’s near-term challenge has risen sharply as Islamabad will have to secure fresh loans of $10 billion in the remaining five months (Feb-June) period to avert default. Against this backdrop, the government sent out SOS (Save Our Soul) to the IMF for reviving the programme that has been stalled since last November. Since then the country has been on a slippery slope to reach at the brink of total economic collapse, Geo News reported.

The State Bank of Pakistan (SBP) in its latest monetary policy conceded that near-term challenges for the external sector have risen despite the policy-induced contraction in the current account deficit during the first half of FY23. “The fresh loans requirements of $8 to $10 billion cannot be managed without blessings of the revival of the IMF programme” sources quoted the SBP’s data stated while talking to The News on Monday.

Read more: Launch of strategy paper on gender responsive budgeting: Jonas Andreae, FES Pakistan

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