All demands met for new bailout package from IMF: Minister of State

Officials have said that Pakistan own Annual budget I International Monetary Fund This month after meeting the demands of The IMF on a bailout of more than six billion dollars Staff Level Agreements wants to

Pakistan set tough revenue targets in its annual budget passed late last month to help it secure a loan from the IMF to stave off another economic crisis while imposing new and hefty taxes. There is growing grief among the people.

Minister of State for Finance and Revenue Ali Pervez Malik told Reuters: ‘We hope that this process (talks with the IMF) will be completed in the next three to four weeks.

He said that the government’s aim is to finalize the staff level agreement before the IMF board’s vacation.

Ali Parvez Malik said of the size of the possible package that ‘I think it will be more than six billion dollars’, but he believes that IMF approval is the main objective at this time.

Meanwhile, the IMF did not immediately respond to a request for comment.

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Pakistan has set a tax revenue target of about 13 trillion rupees ($47 billion) for the fiscal year starting July 1, nearly 40 percent higher than last year, even as the country’s fiscal deficit narrows sharply. which has reached 5.9% of its GDP. Last year this deficit was 7.4% of GDP.

Ali Pervaiz Malik said that the purpose of bringing in a tough and unpopular budget is to use it as a strong foundation for the IMF program. He added that the IMF has expressed satisfaction over the government’s fiscal measures during recent discussions.

The Minister of State said: ‘There are no major hurdles left in the deal now, all the important pre-steps have been completed and the budget is one of them.’

On the other hand, analysts say that this budget, approved with the consent of the IMF, may provoke public anger.

Ali Pervaiz Malik said in this regard: ‘Obviously they (budget reforms) are a burden on the local economy but the IMF program is essential for economic stability.’

Economist Saqib Sherani said an urgent agreement with the IMF was needed to avoid pressure on Pakistan’s foreign exchange reserves and currency.

He told Reuters: ‘If this (agreement with the IMF) takes too long, the central bank may be forced to take temporary controls on imports and capital. It will be a period of uncertainty and another downside is that equities will be bullish.’

Meanwhile, the stock market is witnessing an extraordinary rally with Pakistan’s benchmark share index rising by another one percent to hit a record high of 80,348 points during Wednesday’s trading.

The index has risen about 10 percent since the budget was presented on June 12 and investors are hoping for agreement from the IMF.