News Desk |
Surprising as it may seem, the government is expected to transmit the final version of the budget with the International Monetary Fund (IMF) before the IMF’s board meeting scheduled to be held on July 3.
According to media reports, the government is hoping that the budget will sail through the National Assembly’s session on June 28 (Friday). The reports added that the approved budget and Finance Bill 2019-20 along with a report on compliance with all prior actions will be key elements in the July 3 meeting of the IMF board.
“Completion of all prior actions has paved the way for the board meeting on third of July. Sharing of budget approved by the parliament was one of the prior actions,” a senior official of the ministry of finance told Dawn on condition of anonymity.
Shaikh had said that foreign loans have now exceeded $90bn and exports have registered a negative growth over the past five years.
The official said that the budget approval was the final thing for Pakistan to deliver before the IMF meeting. “The latest exchange rate, SBP policy rate, electricity and gas rates and budget approval were the key prior actions,” the official said.
It has emerged that the Memorandum of Economic and Financial Policies (MEFP) had already been transmitted to the IMF in line with the staff level agreement reached on May 12.
The paper reported that Pakistan will remain committed throughout the 39-month program period to what the State Bank calls a “market-determined exchange rate”. However, it added, if at any stage the central bank comes across reasonable evidence to suggest artificial exchange rate manipulation by outside factors, it will be free to intervene.
Read more: Budget 2019-20 reflects IMF preconditions for $6Bn loan
Pakistan, IMF Finalize US$6 Billion Package-RS-May13
Pakistan and IMF had struck a deal on a bailout package for about US$6 billion over the next three years to meet foreign debt obligations. The IMF and Pakistan reached a staff-level agreement on economic policies for a three-year Extended Fund Facility (EFF) on May 12.
The agreement, which still needs approval from the IMF’s management, had come after months of negotiations arising out of economic crisis with short supplies of foreign currency reserves and stagnating growth.
In brief, as per the Pakistan-IMF accord, Pakistan will receive $6 billion over three years and Pakistan will also receive US$2-3bn from the World Bank and the Asian Development Bank (ADB). Adviser to Prime Minister on Finance, Revenue and Economic Affairs Dr Abdul Hafeez Shaikh had hinted at raising prices in some areas “to recover costs”.
Read more: PTI government signs on with IMF – An unavoidable imperative
Shaikh had said that foreign loans have now exceeded $90bn and exports have registered a negative growth over the past five years.