Pakistan: IMF Loan Agreement delays after 'new demand'

Business Tuesday 09/May/2023 08:03 AM
Pakistan: IMF Loan Agreement delays after 'new demand'

Islamabad: Despite the assurances from friendly countries about external funds to Pakistan, the International Monetary Fund (IMF) is showing a lack of confidence and asking Islamabad to 'do more' to unlock loan programme, ARY News reported on Monday, quoting sources.

According to the sources, Pakistan has been asked to present a repayment plan for a USD 3.7 billion loan to the IMF in June as well as needs to demonstrate stronger support from friendly nations in order to meet the commitment. However, the IMF has reportedly not agreed to a proposal to exchange reserves equal to two months' revenues, which would be valued between USD 11 to USD 12 billion.

Sources within the Ministry of Finance revealed that the government has imposed PKR 170 billion in taxes through the mini-budget in a bid to secure a staff-level agreement with the IMF, which was originally scheduled for February 9, ARY News reported.

It is pertinent to mention here that the IMF issued the schedule of board meetings in which Pakistan is not included in any agenda until May 17.

Funding will also not be available from international financial institutions as the staff-level agreement is not reached, moreover, the budget-making process can be affected if transactions with the IMF are not concluded, ARY News reported.

Last month, the staff-level agreement between Pakistan and the International Monetary Fund is again 'delayed' as the international lender put a new demand.

As per details, the meeting of Finance Secretary Hamid Yakoob in the US remained 'unfruitful' with the International Monetary Fund as the international lender has given the plan to arrange USD 1 billion from commercial banks to unlock the loan program, ARY News reported.

The staff-level agreement was supposed to be signed on February 9 but had been delayed after then over IMF's demands.