Pakistan scrambles to secure IMF deal
\nIslamabad
\nPrime Minister Shehbaz Sharif sees \u201cmore burden\u201d coming on the already inflation-hit masses moving forward as Pakistan scrambles and meets the International Monetary Fund\u2019s (IMF) conditions for reviving the stalled $1.1 billion loan tranche.
\nIslamabad had been hosting an IMF mission since early February to negotiate the terms of a deal, including the adoption of policy measures to manage its fiscal deficit ahead of the annual budget due around June.
\nThe funds are part of a $6.5 billion bailout package the IMF approved in 2019, which analysts say is critical if Pakistan is to avoid defaulting on external debt obligations.
\nDuring an interview on Geo News\u2019 programme \u201cCapital Talk\u201d, the prime minister said that when he came into power, he and his partners were aware that the situation was very bad and that Pakistan was on the brink of default.
\nBut what he did not know was \u201cthat Imran Khan had completely gone back on the promises he made with the IMF, and I was also not aware that [IMF\u2019s] trust in Pakistan was also damaged to a great deal\u201d.
\nThe premier also said that due to Khan\u2019s repeated backtracking, the Washington-based lender is forcing Pakistan to implement the pre-conditions for unlocking the loan tranche.
\n\u201cDefinitely, these conditions resulted in burdening the masses and they will be burdened further. I absolutely acknowledge this,\u201d the prime minister said, mentioning that \u201chardworking Pakistanis will be burdened by this.\u201d
\nThe IMF deal would unlock other bilateral and multilateral financing avenues for Pakistan to shore up its foreign exchange reserves, which have fallen to just four weeks\u2019 worth of import cover.
\nIslamabad has met most of the global lender\u2019s demands to clear the review. The last one yet to be fulfilled on the list is an assurance on external financing to fund its balance of payment gap for the current fiscal year, which ends on June 30.
\nThe prime minister also said that it was not only the IMF\u2019s conditions that were leading to historic-high inflation but Pakistan was also being impacted due to \u201cimported inflation\u201d.
\nSince his government came into power last year in April after removing Khan from power, PM Shehbaz said the Russia-Ukraine war broke out and resulted in the increase in prices of fertiliser, oil, and other commodities that the nation imports.
\n\u201cThe IMF\u2019s toughest conditions have been met and we will sign the staff-level agreement within a few days,\u201d he said \u2014 a similar statement that Finance Minister Ishaq Dar has already made repeatedly.
\nThe incumbent premier further said that despite Khan and his then-cabinet\u2019s repeated criticism of China, the friendly nation has forwarded $1.5 billion in loans to Pakistan.
\nLong-time ally China is the only country that has announced the refinancing of a $2 billion loan, and the State Bank of Pakistan has already received $1.2 billion of that amount.
\nPakistan had to complete a series of prior actions demanded by the IMF, which included reversing subsidies in the power, export and farming sectors, a hike in energy and fuel prices, a permanent power surcharge, jacking up the key policy rate, a market-based exchange rate, and raising over 170 billion rupees ($613.17 million) in new taxation through a supplementary budget.
\nThe fiscal adjustments have already fuelled 50-year record high inflation, which hit 31.5% year-on-year in February.<\/p>\n","protected":false},"excerpt":{"rendered":"
Pakistan scrambles to secure IMF deal Islamabad Prime Minister Shehbaz Sharif sees \u201cmore burden\u201d coming on the already inflation-hit masses moving forward as Pakistan scrambles and meets the International Monetary Fund\u2019s (IMF) conditions for reviving the stalled $1.1 billion loan tranche. Islamabad had been hosting an IMF mission since early February to negotiate the terms […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":{"0":"post-319499","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-top-news"},"yoast_head":"\n