Pakistan pins hopes on IMF loan to keep economy afloat

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State minister for finance says ‘things are moving in right direction’ as PM has approved decisions as per IMF directives for loan revival n Govt trying not to burden common man as the rich will share increased power tariffs and taxes n Pak-IMF talks to conclude today.

ISLAMABAD    -    The federal govern­ment is optimistic that the talks between Pa­kistan and Internation­al Monetary Fund (IMF) would successfully conclude today saying “things are moving in the right direction”.

Federal Minister of State for Finance Ayesha Ghaus Pasha told media yesterday that the negotiations with the IMF are now coming to an end. She said that the govern­ment is trying hard not to burden the common man, as the burden of electricity tariff and taxes would be put on rich people. 

The minister informed that Prime Minister She­hbaz Sharif has given the approval of the de­cisions, which would be taken on the IMF di­rection to revive loan programme. She said that Pakistan needs an agreement with the IMF. 

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Meanwhile, an offi­cial informed that ma­jor differences between the two sides have been resolved. Howev­er, some of the issues are there, which would be settled by Thursday. The policy level talks are scheduled to con­clude today. Both the sides are working to fi­nalize a memorandum of economic and finan­cial policies (MEFP), which is likely to be fi­nalized today.

Meanwhile, the visit­ing delegation met with Federal Minister for Fi­nance and Revenue Ish­aq Dar. The govern­ment has assured the Fund to take difficult decisions for the loan revival. The official said that the Prime Minister has also given assur­ance to implement the IMF programme. 

The government has already accepted some of the tough conditions of the IMF including in­creasing electricity pric­es, bringing a mini budget by increasing standard rate of General Sales Tax by one percent to 18 percent. The IMF has agreed on the con­ditional waiver of approxi­mately Rs500 billion, used for the flood related activi­ties, in the primary deficit. The Fund has asked Paki­stan to bring verification of the expenditures of Rs472 to Rs500 billion, which accord­ing to Pakistan claim, had been issued for the rehabili­tation of flood affected areas, the source said. Pakistan has committed with IMF for the reduction of 0.8 percent in primary deficit, but instead the deficit was increased to Rs1100 billion. However, Pa­kistan has attributed the in­crease in primary deficit with the government’s ex­penditure in flood affected areas. The government has already accepted some more IMF demands. The govern­ment has allowed banks’ ac­cess to asset declarations of civil servants of BS-17-22 as a prior condition for the opening of bank accounts as part of good governance and anti-corruption measures. The government in the last week had decided to end its control on its prices in or­der to fulfil the conditions of the International Monetary Fund (IMF) officials to revive the loan programme.

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