WEB DESK
With the talks between Islamabad and the International Monetary Fund (IMF) visiting mission in their last few moments, the prime minister has reportedly given a go-ahead to settle all matters with the Fund.
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Sources said Prime Minister Shehbaz Sharif held a meeting with the IMF delegation via a video link on Thursday night, and discussed the loan program.
The PM tasked the finance minister with settling all the issues, the sources said.
Earlier, after his own meeting with the visiting delegation, Finance Minister Ishaq Dar had left the Finance Ministry for consultations with PM Sharif.
The minister was to brief the PM on the progress made in talks with the IMF, and inform him of the Fund’s concerns.
An exchange of documents with the IMF is likely after the meeting with the PM. The sources said the Memorandum of Economic and Financial Policies is likely to be subject to strict conditions.
It is worth noting that a possible agreement will lead to Pakistan receiving the next installment of $1.1 billion, which will be approved by the IMF Executive Board.
Under the IMF conditions for the release of the tranche, Pakistan has to increase taxes on electricity, gas, petroleum prices. It has to reduce its circular debt, make reforms in the energy sector.
Pakistan also has to manage funds of up to $5 billion from friendly countries.
‘Good news’
A ‘confident’ Finance Minister Ishaq Dar had earlier on Thursday said he will announce a ‘good news’ today regarding the talks with the IMF mission in Islamabad.
Talking to the media at the Finance Ministry, he claimed negotiations with the global lender were on the right track, and that there were no differences with the Fund.
He said Pakistan has till midnight to finalize the talks.
Pakistan will fulfil the promises it has made to the IMF. Even if the previous government gave false assurances, they will also be fulfilled.
Rejecting the impression that the talks may tumble, Dar said negotiations with the international leader have always been like this.
He said matters with the IMF will be settled today.
Implementation of targets
The final round of negotiations between Pakistan and the IMF is underway in Islamabad.
The government’s economic team, headed by Finance Minister Dar, is holding final talks with the IMF.
The minister will assure the IMF on behalf of the prime minister of implementation of all targets, after which talks will be held on the Memorandum of Economic and Financial Policies.
Sources say that the IMF has set very strict conditions for a reduction in the budget deficit, external financing and forming a budget framework.
After successful negotiations with the IMF, GST will be implemented on petroleum products, while electricity and gas prices will skyrocket.
Completion of the IMF mission’s review would lead to a disbursement of $1.2 billion.
‘Successful’ talks will also unlock financial inflows from friendly countries and other multilateral lenders that Pakistan needs to save itself from a possible ‘default’.
However, the PDM-led federal government has repeatedly rejected the impression created by the opposition Pakistan Tehreek-e-Insaf that the country may face default soon.
