ISLAMABAD: Prime Minister Shehbaz Sharif on Friday expressed gratitude to a “very friendly nation” for providing assistance to Pakistan even before the finalization of negotiations with the International Monetary Fund (IMF) to resume a lifeline needed to avert default.
“There is an allied country of Pakistan, we were all thinking that they were waiting for the IMF agreement and then they would play their part but that allied nation a few days ago conveyed to us that ‘we are giving you [this financial help] straight away’, and these things can never be forgotten.
“There are many such sincere contributions of theirs in the past for Pakistan,” he said while addressing an apex committee meeting in Islamabad.
He did not name the country, the extent of the assistance that was provided, or when the said assistance took place.
The prime minister added that the IMF deal would be finalised in a week to 10 days.
The prime minister said that negotiations with the IMF would soon be successful but economic difficulty would still persist in the form of “very stringent” conditions by the Fund.
Pakistan held 10 days of intensive talks with an IMF delegation in Islamabad — from Jan 31 to Feb 9 — but could not reach a deal.
The IMF, however, said in an earlier statement that both sides have agreed to stay engaged and “virtual discussions will continue in the coming days to finalise the implementation details” of the policies, including the tax measures, discussed in Islamabad.
The government is in a race against time to implement the tax measures and reach an agreement with the IMF as the country’s reserves depleted to a around $3 billion, which experts believe is enough for only 16 or 17 days of imports.
The agreement with the IMF on the completion of the ninth review of a $7bn loan programme would not only lead to a disbursement of $1.2bn but also unlock inflows from friendly countries.
Yesterday, President Arif Alvi signed off on the Finance (Supplementary) Bill, 2023, generally known as the mini-budget, bringing into effect tax measures which will raise an additional Rs170bn in the next four and half months to meet the last prior actions agreed upon with the IMF.
The IMF has given a deadline of March 1 for the implementation of all these measures. However, the bulk of tax measures worth Rs115bn was already implemented from Feb 14 through statutory regulatory orders.
With the implementation of all major prior actions, Pakistan is eyeing a staff-level agreement with the IMF within a fortnight which will also pave the way for much-awaited credit flows from other bilateral and multilateral lenders.
A well-placed source had earlier told Dawn that Pakistan and IMF will sign the staff-level agreement on Feb 28. This will be followed, according to the source, by the IMF executive board meeting expected in the first week of March.
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