IMF-Pakistan talks: Islamabad ‘averts’ mini budget risk

Add ARY News on GoogleFollow on Google DiscoverYouTube screenshotAAResizeThe risks of a mini-budget have eased following talks between Pakistan and the International Monetary Fund (IMF), ARY News reported on Sunday, citing sources.

Pakistan and IMF are holding negotiations over the release of the $1.2 billion fifth tranche under the ongoing loan programme.

According to sources, the IMF is satisfied with Prime Minister Shehbaz Sharif’s economic policies and their implementation. There is no longer any expectation of additional taxes being imposed during the current fiscal year, the sources added.

The IMF is also reportedly satisfied with the economic performance of Finance Minister Muhammad Aurangzeb, sources said.

Sources said the IMF appreciated the Federal Board of Revenue’s (FBR) performance during the July-September period.

The FBR achieved its tax collection target for July through September, which reportedly satisfied the IMF, according to sources.

Sources said the growth in tax revenues means that additional tax measures will not be required.

Read more: IMF ‘calls’ on Pakistan to accelerate energy sector reforms

The FBR has assured the IMF that it will achieve the tax collection target for the current fiscal year.

Despite the ongoing crisis in the Middle East, the IMF is reportedly satisfied with Pakistan’s economic growth and efforts to control the fiscal deficit, sources said.

Pakistan has also assured the IMF that it will finalize a new National Finance Commission (NFC) Award after December.

According to sources, the IMF has also asked Pakistan to meet its targets for containing circular debt in the energy sector.

During the talks, the Pakistani delegation briefed the IMF on progress towards energy sector reforms and informed the lender that the sector had been affected by the regional situation.

Under the zero-inflow target, Pakistan aims to keep energy sector circular debt at around Rs1.6 trillion, sources said.

The Pakistani side also briefed the IMF on external debt repayments, informing the lender that the country expects to secure around $15 billion in foreign financing during the current fiscal year.

Officials said Pakistan had received timely support from Saudi Arabia to help strengthen its foreign exchange reserves.

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