Pakistan-IMF loan agreement delayed after 'new demand'

ISLAMABAD: Despite the assurances from friendly countries about external funds to Pakistan, the International Monetary Fund (IMF) still showing a lack of confidence and asking Islamabad to ‘do more’ to unlock loan programme, ARY News reported on Monday, quoting sources.

According to the sources, Pakistan has been asked to present a repayment plan for a $3.7 billion loan to the IMF in June as well as need to demonstrate stronger support from friendly nations in order to meet the commitment.

However, the IMF has reportedly not agreed to a proposal to exchange reserves equal to two months’ revenues, which would be valued between $11 to $12 billion.

Sources within Ministry of Finance revealed that the government has imposed Rs. 170 billion in taxes through the mini-budget in a bid to secure a staff-level agreement with the IMF, which was originally scheduled for February 9.

It is pertinent to mention here that the IMF issued the schedule of board meetings in which Pakistan is not included in any agenda until May 17.

Funding will also not be available from international financial institutions as the staff-level agreement is not reached, moreover, the budget-making process can be affected if transactions with the IMF are not concluded.

READ: MINI BUDGET ON THE CARDS, IMF DEMANDS HIKE IN TAX ON LUXURY ITEMS

Last month, the staff-level agreement between Pakistan and the International Monetary Fund is again ‘delayed’ as the international lender has put a new demand.

As per details, the meeting of Finance Secretary Hamid Yakoob in the US remained ‘unfruitful’ with the International Monetary Fund as the international lender has given the plan to arrange $1 billion from commercial banks to unlock the loan program.

The staff-level agreement was supposed to be signed on February 9 but had been delayed after then over IMF’s demands.