ISLAMABAD: Federal Minister for Finance and Revenue, Muhammad Aurangzeb on Saturday expressed the expectation of a larger bailout programme from the International Monetary Fund (IMF) and considered improving the revenue distribution between the provinces and the center.

The minister said, if the loan is approved, Islamabad would revisit its NFC Award that allocates revenues between the federation and the provinces. He said that some of the sectors that need to be brought in a much bigger way into the tax net were provincial markets.

Provinces’ share in NFC award can’t be decreased: Sindh CM

Pakistan is requesting a “larger and longer” multi-billion-dollar loan programme from the IMF and discussions are underway with the Fund’s officials, the finance minister said, without specifying how much the nation was trying to secure.

Aurangzeb, who is in the US capital with his team to participate in the IMF and World Bank’s meetings and request new financial package, said once the mission is back in Islamabad, we are going to agree on the priorities and the principles.

“I believe it is Pakistan’s programme. It is not an IMF programme. It is a Pakistan’s programme and it is supported, assisted and funded by the IMF. What’s the size, and the reality and where we are, it’s premature to talk about that. We have our own views and we’ll share it with IMF. But I would rather leave it to the joint meetings in terms of the size and the duration of the programme,” Aurangzeb told a group of journalists and think-tanks.

Asked by TRT World if Islamabad would revisit its National Finance Commission (NFC) award the allocation of revenues between the federation and the provinces once IMF approves the new loan programme, Aurangzeb said, Pakistan needs to review it in the context of 18th amendment where a lot of stuff has been devolved to the provinces.

“It is a discussion which we will have with the provinces in terms of either expenditure sharing or requesting them to incentivise to bring up the tax base, because the reality is, after the 18th Amendment and the NFC Award, some of the sectors which need to be brought in a much bigger way into the tax net are actually provincial markets,” he said.

“Whether it is agriculture, real estate or property construction, we can help support systems, but it is for them to actually go ahead and do it,” he said, adding he has already engaged with the chief ministers of Punjab and Sind provinces with respect to starting the dialogue.

Pakistan signed a short-term agreement with IMF in 2023. Pakistan is seeking a new bailout of up to $8 billion when the current one of $3 billion expires, he added. The finance minister’s visit to US comes as IMF published its updated World Economic Outlook that shows Pakistan will grow at 2 percent. The IMF has kept the country’s growth rate at 3.5 percent for the next fiscal year.

Meanwhile, Aurangzeb ruled out any further significant rupee devaluation.

Speaking at roundtable meeting with Bloomberg team in Washington, he said Pakistan’s solid reserves, stable currency, and growing exports support against rupee devaluation. The finance minister said that his country was ramping up support for industries, agriculture and IT to boost national growth above four percent in the coming years.

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Aamir Apr 21, 2024 09:28am
Now the next targets of IMF are to destroy the agriculture and real estate markets of Pakistan. Soon prices of all food items will sky rocket
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mustafa Apr 21, 2024 07:09pm
provinces should produce taxes on their own ...
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mustafa Apr 21, 2024 07:10pm
@Aamir , paying taxes is normal across the world. even on agriculture ... we should learn the economy
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Usman Apr 21, 2024 10:59pm
We need to finish NFC .It allows provincial govt to do more corruption.Federal should give budgets and spend .This way balochistan and kpk will get more spending for new projects
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Muhammad Alim Apr 21, 2024 11:45pm
Increasing revenue specially by taxing agriculture , property and retail sales is necessary but who will ensure that the tax money will not be squandered by the corrupt politicians and bureaucrats?
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