ISLAMABAD: The risks attached to the short-term 3-billion-dollar Standby Arrangement (SBA) programme of the International Monetary Fund (IMF) will increase manifold with the possibility of the tenure of the caretaker setup going beyond 90 day which seems essential after the approval of the 7th Population and Housing Census, local media reported on Wednesday.
A delay in the general elections is on the cards in the wake of the delimitation exercise going to be undertaken after the CCI approval and notification of the official gazette of the first-ever digital population census. The delimitation exercise requires four months, while two months would be needed to complete the election process.
Under the prevailing situation, the caretaker regime’s tenure might have to be extended beyond six months to complete the process of political transition.
When the SBA programme of $3 billion was designed, it was envisaged that it would be completed during the tenure of three different governments. The first installment of $1.2 billion has already been released during the tenure of the Pakistan Democratic Movement-led regime. The first review is likely to be undertaken on the basis of first quarter (July-September) data of different sectors of the economy with the possibility of the Fund dispatching its review mission to Islamabad in October.
If all targets were materialised, the IMF’s Board might consider approval of a second tranche of $700 million at the end of this year. The second review might be undertaken in February 2024 and the SBA programme would be accomplished in April 2024.
With the possibility of an extension in the tenure of the caretaker setup, the responsibility for materialising all structural benchmarks, performance criteria and indicative targets might be lying with the caretakers amid strict monitoring of all key targets undertaken by the global lender’s mission.
The full implementation of the IMF SBA is essential in order to graduate from the ongoing programme and then qualify for another medium-term programme of the Fund beyond March/April 2024 in order to remove the vulnerabilities faced by Pakistan on repayment of external loans.
