ISLAMABAD: Finance Minister Ishaq Dar Thursday stated that the “International Monetary Fund (IMF) or no-IMF, Pakistan will stay, and will not default,” adding that there was an inordinate delay on the part of the Fund in completion of the 9th review despite the fulfillment of all the conditions.
While speaking during the meeting of the Senate Standing Committee on Finance presided over by Senator Saleem Mandviwalla, the finance minister said geopolitics wanted to take Pakistan to the level that it should default as did Sri Lanka and then negotiate.
He further stated that no valid reason was given by the IMF for the delay in the 9th review and is now objecting to even very small exemptions, which have no revenue impact but are important to put the country on development and growth. We cannot accept every demand of the IMF, he added.
IMF comes down hard on Pakistan’s budget proposals
He said the budget for the next fiscal year was prepared in consultation with the IMF and he (Dar) was not ready to consult/share the budget with the Fund unless it completes the 9th review and starts discussion on the 10th review. However, he added that on the advice of the prime minister, he shared the budget with the Fund.
The finance minister Chinese commercial banks have rolled over the loan after realizing that there was some kind of politics behind the delay in the 9th review. He said that Pakistan financing gap was projected at $6 billion on the basis of $7 billion current account deficit.
As now, the current account deficit is projected at $4 billion instead of $7 billion for the ongoing fiscal year; the financing gap should have been $3 billion but the IMF’s still insist on $6 billion. Dar said an assurance of $3 billion was given by Saudi Arabia and the UAE to the IMF, besides the government would be receiving $400 million from the World Bank of RISE project and $250 million from the AIIB.
The finance minister said that restrictions on imports were imposed to meet the external obligations as the country’s foreign exchange reserves were fast depleting, adding that “the top priority was that all external payments are made in time.” He said that no payments including bonds have been delayed and will not defer any foreign payment in the months ahead.
He said that the government is considering lifting restrictions on imports and soon there would be good news most probably by the end of the ongoing month. He said that wheat fertilizer and hard currency were being smuggled to Afghanistan and this has to be stopped.
Finance Minister Dar told media after the committee meeting that the ninth review of the IMF will be completed this month as negotiations with the Fund are going on and the IMF talks are not over yet.
Copyright Business Recorder, 2023