The International Monetary Fund (IMF) has expressed appreciation for Pakistan’s proactive economic decisions, particularly regarding the increase in gas prices. Virtual talks between Pakistan and the IMF focused on the country’s efforts to meet budgetary conditions laid out by the international financial institution.
Sources close to the discussions revealed that Pakistan briefed the IMF on the steps taken to raise gas prices and other economic measures outlined in the fiscal budget. Negotiations are currently underway for a new loan program, with expectations high for an agreement to be finalized later this month.
The Ministry of Finance confirmed that all prerequisites for negotiating with the IMF have been fulfilled, signaling a positive trajectory in the talks. Earlier, on June 29, the IMF had critiqued the approval of Pakistan’s budget for 2024-25 as insufficient, urging the country to implement further reforms.
IMF directives include the immediate hike in electricity and gas rates from July 1, aligning with NEPRA decisions on tariff adjustments. The international body also stressed the necessity of removing tax exemptions and subsidies, crucial steps it views as essential for Pakistan’s economic recovery.
Finance ministry officials are optimistic about finalizing the new loan program with the IMF by July. While the exact amount remains to be determined, estimates suggest the program could range between $6 billion and $8 billion, spanning a three-year period.
The approval of Pakistan’s Federal Budget for the fiscal year 2024-25 by the National Assembly on July 28, with a total outlay of Rs18,870 billion, sets the stage for comprehensive economic reforms aimed at stabilizing the country’s financial footing.
As discussions continue, Pakistan anticipates solidifying its economic policies in alignment with IMF recommendations, aiming for sustainable growth and fiscal stability in the coming years.
