The International Monetary Fund (IMF) has asked Pakistan to freeze all major non-development expenditures heads, including salaries and defence, in order to bring down primary deficit. The IMF staff proposed Pakistan to to undertake massive fiscal adjustments of Rs1,150 billion to bring down primary deficit at negative 0.4 percent of GDP for the upcoming budget 2020-21 post COVID-19 pandemic.
Pakistan has received $1.39 billion by the International Monetary Fund (IMF) to shore up economy, according to the State Bank of Pakistan’s tweet. This is a loan under the Rapid Financing Instrument. It was approved by the IMF on April 17 to bolster the economy during the COVID-19 pandemic. It is expected to meet urgent balance of payment needs that have arisen due to the pandemic.
The four provinces jointly provided a whopping cash surplus of Rs202 billion to the Centre during the first quarter (July-September) of the current fiscal year to help meet its fiscal targets committed to the International Monetary Fund (IMF). The provinces did not utilise more than one-fourth of the funds for the welfare of their citizens made available to them under their total revenue.
International Monetary Fund (IMF) Resident Representative Teresa Daban has said that it is essential for Pakistan to exit the grey list of the Financial Action Task Force (FATF) in order to secure private sector credit to meet external financing needs. “Failure to exit from the FATF grey list is a risk to the recently approved $6 billion IMF deal,” said Daban.
Minister of State for Revenue, Hammad Azhar, revealed in National Assembly on Friday that Pakistan Tehreek Insaf (PTI) has set a new precedent by retiring $9.5 billion foreign loans in first year of power. He also added that Pakistan’s foreign loans rose by $2.7bn as compared to last year of PML-N government when foreign debts increased by over $7bn.