IMF validating data, negotiations moving in right direction: Tarin

The International Monetary Fund (IMF) is validating the data provided by the government of Pakistan, said Finance Minister Shaukat Tarin, who added that negotiations with the international lender "are moving in the right direction".

Talking to media at the Pakistan Embassy in Washington DC about his interaction with the International Monetary Fund (IMF) Director Kristalina Georgieva, Tarin said the lender appreciated the progress made on the programme.

Tarin, alongside State Bank of Pakistan (SBP) Governor Dr Reza Baqir, said the IMF acknowledged the difficult circumstances in which the country has moved forward.

“It was all positive and she appreciated that under very difficult circumstances, Pakistan has made all efforts to reform the economy,” said Tarin, who is in the US to attend the World Bank and IMF annual meetings.

Tarin said that the Pakistan delegation will remain in New York for the next 2-3 days. The country is seeking a successful review of the Extended Fund Facility that would pave way for a billion-dollar inflow.

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Tarin said that in the coming few days Pakistan and the IMF will make a joint announcement under which the review will be completed and Pakistan will receive $1 billion from the IMF.

The finance minister said that he informed the IMF that the government had collected Rs175 billion of additional revenue in the first three months of this fiscal year. “I want to reach a tax to GDP ratio of 14 % by next year in order to reach the 20% target in 4-5 years,” said the minister.

Regarding the latest increase in the prices of petroleum products, Tarin said that the hike is not related with IMF negotiations, saying that it is only because of increase in rates in international markets.

Tarin also shared that he would be elected as senator from Khyber Pakhtunkhwa. He said he has been appointed as an adviser.

Meanwhile, talking about the USD/PKR exchange rate, Dr Baqir said the ongoing trend is a reflection of market dynamics.

Dr Baqir said that the conversion to a market-based regime allows to maintain the current account deficit at a sustainable level. “CAD will not increase like it did in the past because exchange rate was not adjusted which led to increase in imports and current account deficit,” he said.

He added that the market-based exchange rate is allowing us to “preserve our reserves”.

Earlier, US Assistant Secretary of State for South and Central Asia Donald Lu called on Tarin at the Pakistan Embassy.

The Finance Minister reaffirmed Pakistan’s desire for a broad-based and sustainable relationship with the United States. He underscored Pakistan’s interest in enhancing investment and trade linkages, reiterating the government’s commitment to undertaking further economic reform and improving the ease of doing business for foreign companies.

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Tarin also reiterated Pakistan’s support for an inclusive political settlement in Afghanistan.

Tarin and the visiting Pakistan delegation also met Lutfi Elvan, Minister of Treasury and Finance of Turkey, and his team.

Both agreed to further strengthen and diversify bilateral economic and commercial cooperation. The Turkish side offered to assist Pakistan in developing key sectors including agriculture, construction and tourism. Furthermore, expert-level discussions are to take place soon.