Mohsin Siddiqui Chief Reporter

The International Monetary Fund (IMF) lauds the Pakistani authorities for their satisfactory performance in meeting end-December quantitative performance criteria (QPCs), Indicative Targets (ITs), and Structural Benchmarks (SBs) under the Stand-By Arrangement (SBA).

According to the IMF’s report titled “Second and final review under the SBA,” the authorities successfully achieved all seven quantitative Performance Criteria (PCs) for end-December 2023. This includes meeting floors on net international reserves of the State Bank of Pakistan (SBP) and targeted cash transfer spending, as well as ceilings on net domestic assets of the SBP, SBP’s FX swap/forward book, net government budgetary borrowing from the SBP, general government primary budget deficit, and government guarantees. Additionally, both continuous PCs on zero new flow of SBP credit to the government and zero external public payment arrears were met.

Regarding Indicative Targets (ITs), the authorities fulfilled all four targets for end-December 2023. These include meeting floors on budgetary health and education spending, and FBR net tax revenues, as well as ceilings on net accumulation of tax refund arrears and power sector payment arrears.

Furthermore, the Structural Benchmarks (SBs) related to the BISP inflation adjustment, notification of the semi-annual gas tariff adjustment determination, and development of a plan to strengthen the SBP’s internal control systems in lending operations were all achieved. Continuous SBs on not granting further tax amnesties, avoiding new preferential tax treatments or exemptions, and maintaining an average premium of no more than 1.25 percent between the interbank and open market rate were also met.

However, progress toward amending four dedicated State-Owned Enterprise (SOE) laws, which was a missed SB by end-November 2023, is still underway. Alignment of legislation with requirements is ongoing, with the timing of its passage contingent on the recently seated National Assembly.