Pakistan, IMF fail to reach consensus for a fresh bailout package

ISLAMABAD: Another round of talks between Pakistan and the International Monetary Fund (IMF) ended ‘fruitless’ on Tuesday, as both the sides failed to reach consensus for a fresh bailout package, ARY News reported.

According to the sources, during the talks held in Islamabad, the officials negotiating from the IMF side, placed demands of further devaluation of rupee against the greenback, increase in tax collection and interest rate.

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To these demands Pakistani officials, stated that an increase in the interest rate will simultaneously increase expenses on the government side, while achievement of tax collection of 4435 bn rupees target will also be difficult, the sources said.

Sources within the Finance ministry said rupee already has been devalued, while demands of the IMF are not acceptable to us.

However, Pakistan and the IMF agreed to continue talks in the future, while dates in this regard, will be decided later with the mutual consent of both the parties.

Earlier in the month of November, Pakistan had extended talks with the IMF after the two sides failed to agree on the terms of a bailout package.

Finance ministry spokesman Noor Ahmed said there were still some issues to be ironed out.

“We have covered a lot of areas in terms of convergence of views,” Ahmed told Reuters. “But there is some more distance to be covered and that’s not much. Another 20 percent of distance has to be covered.”

Ahmed said Pakistan will “stay engaged” with IMF officials to resolve the outstanding issues and “over the next two weeks we will bridge those gaps”. A final deal is expected to be signed off by mid-January.

Pakistan is seeking its 13th bailout since the late 1980s to deal with a current account deficit that threatens to trigger a balance of payments crisis.