A number of government ministries have begun preparing for the upcoming negotiations with the global lending institution, including that of the finance ministry.
In July, the IMF approved a loan program for the cash-strapped country, currently operating under a caretaker government. This development was confirmed by the IMF’s resident representative, Esther Perez Ruiz. Pakistan received its first $1.2 billion tranche from the Washington-based lender shortly after approval of the loan program.
“An International Monetary Fund team led by Nathan Porter is coming to Pakistan starting November 2 to review the Stand-By Arrangement,” Ruiz said.
To get an update on all structural benchmarks, indicative criteria, and performance criteria agreed upon with the IMF by September 2023, the finance secretary has convened an important meeting tomorrow (Thursday).
According to The News, the finance ministry has made every attempt to limit the budget deficit to the limits agreed upon with the lender. It had warned the provinces to trip down spending, and the latest provisional estimates suggest that Punjab and Sindh have made significant progress on it.
Another challenge for restricting the overall fiscal deficit is the rising debt servicing requirements that would, of course, balloon and stand beyond Rs8.3 trillion to Rs8.5 trillion for the current fiscal year 2023–24 against the initially envisaged target of Rs7.3 trillion in the wake of a surged policy rate of the central bank.
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