ISLAMABAD: The International Monetary Fund (IMF) on Monday asked Pakistan to demonstrate stronger support from friendly nations and present a repayment plan for a $3.7 billion loan by June, as the country struggles to unlock the loan programme, said the sources privy to the development.
The sources said that the IMF asked Pakistan to ‘do more’ and has reportedly not agreed to a proposal to exchange reserves equal to two months’ revenues, which would be valued at between $11 billion and $12 billion despite that assurance from friendly countries about external funds.
The government imposed Rs. 170 billion in taxes through a mini-budget to secure a staff-level agreement with the IMF. However, the international lender delayed the staff-level agreement as it had demanded a plan to arrange $1 billion from commercial banks to unlock the loan programme.
The IMF issued the schedule of board meetings, but Pakistan is not included in any agenda until May 17. As funding wuld not be available from international financial institutions if the staff-level agreement was not reached, the budget-making process could be affected if transactions with the IMF were not concluded.
The sources within the Ministry of Finance revealed that the IMF did not show confidence in Pakistan’s economy, even though friendly countries provided assurances about external funds. While the government was taking steps to secure the staff-level agreement with the IMF, the international lender demanded more from the country.
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Despite Pakistan’s efforts, the IMF is still not satisfied with the country’s plans to unlock the loan programme. The country is also facing challenges in securing funding from international financial institutions due to the delay in the staff-level agreement.
It remains to be seen whether Pakistan can meet the IMF’s demands and unlock the loan programme. The government has taken steps to secure a staff-level agreement, but the IMF’s demands have delayed the process. As the country continues to face economic challenges, the government will need to work with international lenders to secure funding and address the country’s economic issues.
Pakistan has been facing economic challenges in recent years, with high inflation rates and a current account deficit. The country’s government has been working to secure funding from external sources to address these issues. While friendly countries have provided assurances about external funds, the IMF’s lack of confidence in the country’s economy could delay the process of unlocking the loan programme.
