'False and unfounded': govt rejects reports IMF concerned about funds use for 'political purposes'
- Finance Division says funds cannot be utilised for any purpose without the approval of the Parliament through the budget
The government on Saturday clarified that media reports stating the delay in signing the International Monetary Fund (IMF) agreement is due to the lender seeking assurances from the Ministry of Finance that the funds will not be used for political purposes are "false and unfounded."
"It is clarified that this news is false and unfounded as IMF has never raised any such concern with the Government nor any funds can be utilized for any purpose without the approval of the Parliament through the budget," the Finance Division said in a statement.
The development comes days after the IMF reiterated that it was working with Pakistani authorities to bring the pending ninth review to the conclusion “once the necessary financing is in place and the agreement is finalised”.
“In addition, the IMF supports the authorities in the implementation of policies in the period ahead, including in the technical work to prepare the FY24 budget, which is to be passed by the National Assembly before end-June,” Nathan Porter, the IMF Mission Chief for Pakistan, was quoted as saying in a statement to Business Recorder.
Pakistan remains engaged with the Washington-based lender to resume its bailout programme that has been stalled at the ninth review since November last year.
As part of prior conditions to resume funding, Pakistan was required to undertake a series of steps including new taxation measures, free-floating exchange rate, and hike in energy tariffs.
It was reported earlier that Pakistan is required to make debt payments of $3.7 billion in May and June, according to Fitch Ratings, which would cause further pressure on an already depleted level of foreign exchange reserves.
Pakistan’s policymakers have derived some hope from a current account surplus in March, which brings down the gap in financing, but securing fresh funding commitments – even after China’s rollover and another refinanced loan of $1.3 billion – remains the next hurdle.
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