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Pakistan agrees to share budget details with IMF to unlock stalled programme

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2 years ago

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  • “Pakistan has already completed all conditions of IMF,” Ishaq Dar says.
  • FinMin says some powers do not want economic stability in Pakistan.
  • Financial czar slams Imran Khan-led govt for violating pact with IMF.

Finance Minister Ishaq Dar has revealed that the coalition government has agreed to share details of its upcoming budget details with the International Monetary Fund (IMF) in order to unlock the stalled funds.

“They have asked us for some more details like the details of (the) budget, we will give that to them,” Dar said while speaking on Geo News programme Jirga on Sunday.

He reiterated that the country has fulfilled all conditions laid forth by the Washington-based lender to revive the stalled $6.5 billion programme and urged the global lender to release the funds before the upcoming federal budget due next month.

The financial czar said some powers do not want economic stability in Pakistan and blamed the previous Pakistan Tehreek-e-Insaf (PTI) government for “destroying” the country’s economy.

“Record inflation was witnessed during Imran Khan’s tenure,” he said, adding that the former prime minister did not honour the agreement with the IMF.

The IMF’s $1.1 billion funding to Pakistan, which is part of the $6.5 billion rescue package agreed in 2019, has been held up since November.

The IMF and Pakistan held two weeks of talks in February in Islamabad to conclude the 9th review, but the lender has not yet released the money, which is critical for the country to unlock other bilateral and multilateral financings.

The federal minister further said that he would want the IMF to release the funds before the budget was presented, which is due in early June.  He added, “We will not do the 9th and 10 reviews together. This is unfair.”

Pakistan is making last-ditch efforts with the IMF to revive the stalled Extended Fund Facility (EFF) programme, The News reported earlier this month.

The hopes are diminishing each day mainly because the ongoing programme of $6.5 billion under the EFF will expire on June 30.

The parleys between Pakistan and the IMF continue for the completion of the ninth review, which was due on November 3 of last year. The formal negotiations started on January 31 when an IMF delegation visited Pakistan for in-person talks.

However, the two sides could not reach a consensus during the course of scheduled talks that ended on February 9. Since then, multiple online sessions have been held but the differences persist on conditions set by the Fund for the Staff Level Agreement (SLA).

If the SLA is not struck ahead of the upcoming budget for 2023-24, scheduled to be unveiled on June 9, the ongoing programme will face a failure.

“There are a couple of options left for moving forward. The first is by signing the SLA on an immediate basis and forwarding Pakistan’s request before the IMF Executive Board for approving the next tranche of $1 billion and also securing an extension in the EFF programme period by a few months in order to accomplish the 10th and 11th Reviews,” sources, privy to the background discussions told the publication.

The second option could be combining the 9th and 10th reviews and for Pakistan to share upcoming budgetary numbers with the IMF.

Then the SLA should be signed after the announcement of the budget and in case of its approval from parliament, the IMF’s Executive Board could approve combined tranches and also grant an extension to the EFF programme for accomplishing the 11th Review by July or August 2023.

“There are no easy options available; both sides will have to work out modalities for evolving consensus. But with the existing approach of maintaining the status quo, no breakthrough can be achieved,” said the official who spoke on the condition of anonymity.

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With its second-largest surge ever, PSX approaches 114,000 points.

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Driven by renewed activity from both private and government financial institutions, the Pakistan Stock Exchange (PSX) saw its second-largest rally in history on Monday.

The market regained many important levels in a single trading session as it rose with previously unheard-of momentum.

Intraday trading saw a top increase of 4,676 points, and the PSX’s benchmark KSE-100 Index gained 4,411 points to settle at 113,924 points. This impressive rebound demonstrated significant investor confidence by reestablishing the 100,000, 111,000, 112,000, and 113,000-point levels.

The market also saw the 114,000-point limit reestablished during the trading session.

The positive tendency was reflected when the market’s heavyweight shares touched its upper circuits. Among the most busiest trading sessions in recent memory, an astounding 85.78 billion shares worth a total of Rs55 billion were exchanged.

Experts credited the spike to heightened institutional investor activity and hope for macroeconomic recovery. Considered a major market recovery, the rally demonstrated the market’s tenacity and development potential.

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In interbank trade, the Pakistani rupee beats the US dollar.

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1 week ago

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In the international exchange market, the US dollar has continued to weaken in relation to the Pakistani rupee.

The dollar fell to Rs278.10 from Rs278.17 at the beginning of interbank trading, according to currency dealers, a seven paisa loss.

In the meantime, there was a lot of turbulence in the stock market, but it recovered and moved into the positive zone. The KSE-100 index recovered momentum and reached 116,000 points after soaring 1,300 points.

Both currency and stock market swings, according to analysts, are a reflection of ongoing market adjustments and economic uncertainty.

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Phase II of CPEC: China-Pakistan Partnership Enters a New Era

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The cornerstone of economic cooperation between the two brothers and all-weather friends is still the China-Pakistan Economic Corridor, the initiative’s flagship project.

In contrast to reports of a slowdown, recent events indicate a renewed vigour and strategic emphasis on pushing the second phase of CPEC, known as CPEC Phase-2, according to the Ministry of Planning, Development, and Special Initiatives.

According to the statement, this crucial stage seeks to reshape the foundation of bilateral ties via increased cooperation, cutting-edge technology transfer, and revolutionary socioeconomic initiatives.

Planning Minister Ahsan Iqbal is leading Pakistan’s participation in a number of high-profile gatherings in China, such as the 3rd Forum on China-Indian Ocean Region Development Cooperation in Kunming and the High-Level Seminar on CPEC-2 in Beijing.

His involvement demonstrates Pakistan’s commitment to reviving CPEC, resolving outstanding concerns, and developing a strong phase-2 roadmap that considers both countries’ long-term prosperity.

At the core of these interactions is China’s steadfast determination to turn CPEC into a strategic alliance that promotes development, progress, and connectivity.

Instead of being marginalised, CPEC is developing into a multifaceted framework with five main thematic corridors: the Opening-Up/Regional Connectivity Corridor, the Innovation Corridor, the Green Corridor, the Growth Corridor, and the Livelihood-Enhancing Corridor.

With the help of projects like these, the two countries will fortify their partnership, and CPEC phase-2 will become a model of global economic integration and collaboration that benefits not just China and Pakistan but the entire region.

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