IMF Loan Pakistan: Everything is over in Pakistan! Now the dream of IMF loan is also stuck, is the organization changing its mind? – crucial imf loan for pakistan hangs amid biggest economic crisis
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negotiations at critical junctures
The talks with the IMF have reached a critical stage and can turn in either direction. The Shehbaz government hopes to get the IMF to agree to a better deal by Thursday, the last day of talks. At the same time, a government official said, ‘We cannot say that everything has stopped as both sides are still holding talks with an open mind.’
According to this official, the IMF needs more information on expected provincial cash balances before arriving at the primary fiscal deficit. The government has set a provincial cash surplus of 750 billion rupees for this fiscal year. The four federal units showed only 177 billion rupees in surplus in the first quarter. The surplus was 304 billion rupees or 63% less than the comparable period of the previous fiscal year.
Challenging 48 hours
Pakistan hopes to receive the first draft of the MEFP on Monday. This is the important document that is attached to the bailout package. The document will reflect the revised fiscal, monetary and external sector targets for the remainder of this financial year and projections for the next financial year. IMF has not yet shared this draft with the Government of Pakistan. Shahbaz and his officers kept waiting for this till late Tuesday evening. Any further delay only means that the situation for the next 48 hours could be very challenging.
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The country’s Finance Ministry was hopeful that it would get the draft by Wednesday. If the IMF hands over the first draft, then the country can get relief within the next 24 hours. According to sources, the energy sector is the biggest hurdle. Because of this everything is stuck. Similarly, the gross external financing shared by the Ministry of Finance also has some problems with the IMF.
Will not get any more loan
The IMF was assuming that Pakistan would not be able to get a loan of $ 3.6 billion from China. But the Finance Ministry said that one bank each from the Gulf and the European Union has shown interest in it. But right now everything is at the primary level. Talks are on between Pakistan and the IMF regarding the ninth review programme. If the talks are successful, the country will be able to get the first tranche of $1.1 billion immediately. Till there is no announcement from IMF, multilateral and bilateral creditors will not give new loan to Pakistan. Finance Minister Ishaq Dar has also held a meeting with the officials of the World Bank.
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