ISLAMABAD, Jan 31 (EW): The review mission of the International Monetary Fund (IMF) led by its chief Nathan Porter, called on Finance Minister Ishaq Dar in Islamabad on Tuesday and said that he expected Pakistan to meet the international money lender’s requirement “in time”.
The IMF mission is in Pakistan to deliberate on policies aimed at restoring domestic and external sustainability, strengthening the country’s fiscal position and power sector reforms.
The meeting discussed and reviewed the economic and fiscal policies and reforms agenda to accomplish the 9th review under the Extended Fund Facility (EFF).
The finance minister briefed the mission on fiscal and economic reforms and measures being taken by the government in different sectors, including bridging the fiscal gap, exchange rate stability and the energy sector for the betterment of the economy.
He said reforms are being introduced in the power sector and a high-level committee has been formed for devising modalities to offset the menace of circular debt in the gas sector.
Stressing the government’s resolve to complete the current IMF programme, Dar said Pakistan is committed to working with the IMF for reaching an agreement to complete the review under the EFF.
On the occasion, Porter expressed confidence that Pakistan would meet the IMF requirements for the completion of the 9th review.
He hoped that Pakistan would continue towards its progress on reforms in various sectors and will complete the IMF programme effectively and in time.
He added that the Fund will be working together with Pakistan on fiscal reforms.
Pakistan is expected to narrowly escape defaulting on its international payments after the IMF had finally agreed to continue discussions under the EFF review.
In a bid to revive the stalled loan programme worth $6.5 billion – due to begin early next month if successful – the government has surrendered its control over the exchange rate, allowing market forces to determine the value of the rupee.
The resumption of the IMF programme will allow the country to fetch new foreign debt inflows worth around $3-4 billion within a couple of months, improve the foreign exchange reserves and avert the looming risk of default.
While the prime minister has expressed confidence that Pakistan would conclude a deal with the IMF during the current month in a bid to overcome financial challenges, the negative impacts of the IMF programme will be high inflation in the range of 29-31% from February onwards.
