published by, Saurabh Verma
Last Update: March 09, 2023, 20:56 IST
Pakistan’s Finance Minister Ishaq Dar pledged on Thursday that the government is “fully committed” to completing the current US$7 billion bailout program with the IMF, once again indicating that the cash-strapped country will be unable to meet the global lender’s expectations. Can sign employee level agreement with. Week.
The Dawn newspaper reported that the Pakistan government is in a race against time to implement measures to reach an agreement with the International Monetary Fund (IMF), as the country has barely enough reserves for three weeks of essential imports. While the hotly contested elections are due by November. ,
Addressing a seminar organized by the Finance Ministry here, Dar said, “My team and I have decided that in a short span of time we will implement and discharge all the sovereign commitments made by the previous government.” Pakistan and the IMF are holding virtual talks after 10 days of intense talks between the two sides with the IMF delegation in Islamabad from January 31 to February 9, which failed to reach an agreement.
He reminded that the coalition government was handed over an economy in “shatter condition”.
“To top it [off], the previous government (led by Imran Khan) had agreed to a credit facility which was extended by the IMF. But instead of honoring the commitments made before leaving office, he reversed some of the conditions. it caused a serious trust deficit [between the lender and Pakistan],” he highlighted.
However, the minister said, the government had realized that these obligations were not made by an individual but by the sovereign state of Pakistan and decided to honor the commitments.
He said, ‘We are in the process of the ninth review, which should have taken more time than it should have […] Hopefully in the next two days we are looking very close to signing the staff-level agreement,” Dar said.
Agreement with the IMF on the completion of the ninth review of the US$7 billion Extended Fund Facility program – which has been delayed over a policy framework since late last year – will not only disburse $1.2 billion but also unlock inflows. from friendly countries.
The conditions required by the lender are aimed at ensuring that Pakistan reduces its fiscal deficit ahead of its annual budget around June.
Pakistan has already taken most of the other actions, including raising fuel and energy tariffs, withdrawing subsidies in the export and power sectors, and generating more revenue through new taxation in a supplementary budget.
Prime Minister Shehbaz Sharif announced a series of austerity measures last month, including forgoing salaries of cabinet members, paying his own bills, banning the purchase of luxury vehicles from 2024 and slashing current spending by 15 percent.
The Finance Minister further said that Pakistan’s economic difficulties will be further aggravated by the devastating floods of 2022, affecting 33 billion people and causing physical and economic losses of around USD 30 billion.
The flood, which submerged a third of Pakistan, destroyed land, crops and infrastructure, killing more than 1,700 people.
“But despite financial constraints and limitations, the federal and provincial governments have jointly allocated 452 billion rupees for flood-affected relief and rehabilitation work.
“This persistent fake propaganda about the country defaulting on its international obligations is completely false and preposterous […] In fact it harms the country.
Dar said he has been appealing to political parties to sit together and sign the charter of the economy, but regretted that it always fell on “deaf ears”.
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(This story has not been edited by News18 staff and is published from a syndicated news agency feed)