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An agreement on the specifics of a reform agenda between International Monetary Fund (IMF) and Pakistan is yet to be reached on a bailout package as the two sides will hold technical and policy level discussions before an agreement is reached, including on debt stock. Sources in the Finance Ministry said that the IMF staff level mission is expected to visit Pakistan for technical discussions on trade, taxes, tax collection power sector and other subsidies, however, the dates are yet to be decided.
When contacted Finance Ministry spokesman Dr Khaqan Najeeb stated that "all issues, including adequate energy financing flows and energy sector reforms, fiscal consolidation as well debt profile continued to be deliberated with the IMF. The government has shared its roadmap of planned structural reforms in all key areas to bridge the savings investment gap and the import export gap. Dr Najeeb added that in the coming weeks technical level discussion will continue to support the process of dialogue on these specific issues.
He further stated that the government has shared its plan with the IMF to bring down line losses and increase recovery to the NEPRA determined level to curtail the flow of circular debt. In addition, the efficiency and arrear recovery work is ongoing. All the policy actions will help in bridging the energy revenue requirements, Najeeb said, adding that the Pakistani side is engaged to move ahead on a balanced reform program.
Sources on condition of anonymity said that the IMF has requested full details of investment and loans under the China Pakistan Economic Corridor (CPEC) along-with mode of repayment and rate of return as well as when the repayment would begin. They added that about fifty percent of CPEC projects - investment and loans - have already been shared with the Fund.
Finance Ministry has agreed to the IMF proposal that the government implements electrify tariff determined by National Electric Power Regulatory Authority (NEPRA) without any delay.
There is positive development in some areas while in other areas a lot would depend on the trade balance for the month of January 2019 as well as revenue collection and reduction in line losses in the power sector. When asked about reports that the government intends to seek $6 billion loan from the IMF, sources said that the volume of the bailout package is not authentic - it could be more or less than $ 6 billion.
Minister of State for Revenue Hammad Azhar tweeted in response to a headline carried by a section of the print media: "a very misleading headline, the Prime Minister and the IMF chief did not discuss gas prices or power tariffs".

Copyright Business Recorder, 2019

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