Business

Finance ministry readies itself for upcoming IMF review

Published

1 year ago

Farwa

IMF team is scheduled to arrive in Islamabad on Nov 2 and is expected to stay in Pakistan till Nov 16.

IMF team is scheduled to arrive in Islamabad on Nov 2.
It is expected to stay in Pakistan till Nov 16.
Real bone of contention to be external financing needs.

ISLAMABAD: The Ministry of Finance has started preparing for the upcoming review talks with the International Monetary Fund (IMF) that expected to are expected to begin this week, reported The News on Tuesday.

According to the publication, the ministry has evaluated the progress on key targets, including achieving the disbursement of Rs87.5 billion in cash transfers to beneficiaries under the Benazir Income Support Programme (BISP).

IMF, under the quantitative performance criteria, had set the ceiling on the amount of government guarantees related target at Rs4,000 billion but the ministry was able to confine total guarantees to Rs3,853 billion till the end of September 2023. But the real bone of contention in the review talks would be the external financing needs of Pakistan.

The forex market functioning may also become a problematic issue as the IMF had placed the withdrawal of the circular on prioritisation in providing forex for certain types of imports introduced in December 2022 under a structural benchmark. It was placed under structural benchmark as the IMF wanted to ensure “full market determination of the exchange rate”.

The finance ministry in its meeting took note of the progress on quantitative performance criteria, continuous performance criteria, indicative target, and structural benchmark conditions agreed with the IMF for the end of September 2023 under the $3 billion standby arrangement (SBA) programme.

The IMF team is scheduled to arrive in Islamabad on November 2 and is expected to stay in the country till November 16.

The government has also kept the circular debt of the power sector within the envisaged limits as it went up by Rs227 billion in the first quarter and touched Rs2.5 trillion by the end of September 2023.

“The target of increasing circular debt has been achieved successfully which was agreed with the IMF under revised circular debt management plan (CDMP),” an official told The News on Monday.

Regarding cash transfer to the beneficiaries under BISP, the official said that the government has so far disbursed Rs89 billion till September 2023 against the envisaged target of Rs87.5 billion. He added that the unconditional and conditional cash transfer was “well within the desired target”.

The official said that the next installment would be disbursed under BISP in November 2023, after which the cumulative disbursement under the programme would touch Rs185 billion. The government has allocated a disbursement target of Rs460 billion for BISP in the ongoing fiscal year.

Meanwhile, State Bank of Pakistan (SBP) officials said that they are on track to meet the floor on net international reserves (NIR) which they said would stand at negative $14.5 billion till the end of September 2023.

The ceiling on net government budgetary borrowing from the SBP stood at Rs4,078 billion for the end of September 2023 as the government’s borrowing from the central bank remained zero.

The indicative target of FBR’s collection has been achieved as the floor on net tax revenues collected by the FBR was envisaged at Rs1,977 billion till the end of September 2023. The ceiling on net accumulation of tax refund arrears stood at Rs32 billion.

Business

SFD and Pakistan Sign Two Deals Totaling $1.61BLN

Published

1 day ago

Farwa

Two agreements totaling $1.61 billion have been inked by Pakistan and the Saudi Fund for Development to improve their bilateral economic cooperation.

Business

Saudi Arabia and Pakistan sign an MOU to strengthen their auditing industry collaboration.

Published

1 day ago

Farwa

A spokesperson for the office of the Auditor-General of Pakistan (AGP) announced on Monday that the two countries have signed a Memorandum of Understanding (MoU) to strengthen cooperation in public sector auditing through improved cooperation between audit institutions of both countries, as well as training programs and the exchange of trainers.

This comes as a group from Saudi Arabia’s General Court of Audit (GCA), headed by GCA President Dr. Hussam bin Abdulmohsen Alangari, arrived in Pakistan on Sunday for a four-day visit.

The agreement was signed during AGP Muhammad Ajmal Gondal’s meeting with the Saudi delegates, aiming to strengthen audit cooperation, enhance knowledge-sharing, and improve governance, transparency and accountability in government spending.

Public relations officer Muhammad Raza Irfan of the AGP’s office told Arab News that the deal will further advance bilateral collaboration between Saudi Arabia and Pakistan in addition to enhancing professional ties between the two nations’ auditing institutions.

In a statement released from his office, AGP Gondal was cited as saying, “This collaboration marks a significant step toward fostering international cooperation in auditing.”

“The exchange of ideas and methodologies will undoubtedly strengthen our capacity to meet emerging challenges and set new benchmarks for public accountability.”

Discussions at Monday’s meeting focused on fostering closer ties between the Supreme Audit Institutions (SAIs) of Pakistan and Saudi Arabia, sharing innovative audit methodologies, and planning collaborative initiatives for the future, according to the AGP office.

The two parties decided to increase their knowledge of theme, environmental, and impact audits as well as to exchange best practices in audit standards, performance audits, and citizen participation audits.

The statement added, “It also agreed to exchange trainers, address new auditing challenges, plan cooperative audits, including a performance audit on the oil and gas sector in 2025, and work together on training programs.”

Both sides reaffirmed their shared commitment to promoting transparency, accountability and excellence in public sector auditing.

Business

The government chooses to continue the PIA privatization process.

Published

1 day ago

Farwa

The Pakistan International Airlines (PIA) privatization process will be restarted by the federal government, and expressions of interest would be requested within the month. Officials stated that the Prime Minister’s Committee on Privatization will convene to make the final decision.

Usman Bajwa, the secretary of the Privatization Commission, gave a briefing on the updated procedure to the National Assembly Standing Committee on Privatization. Additionally, he disclosed that airlines other than PIA are now able to compete with regional carriers thanks to IMF-approved aircraft tax concessions.

Farooq Sattar, the chairman of the privatization committee, underlined the importance of giving PIA workers at least five years of job security. Employee protection will continue to be a top priority and will be resolved prior to bidding, the Privatization Commission promised.

PIA’s liabilities totaling Rs650 billion have already been assumed by the government, and an additional Rs45 billion in outstanding debts must be paid before the privatization process can begin. As of the now, PIA has assets around Rs155 billion and liabilities worth Rs200 billion. It will be necessary for the new buyer to expand the fleet by 15 to 20 aircraft.

Additionally, the Privatization Committee has sought a timeline for the privatization of Faisalabad, Gujranwala, and Islamabad Electric Supply Companies. Officials stated that after the appointment of a financial advisor, the privatization process for these companies will accelerate.