The third round of talks between the International Monetary Fund (IMF) and the Pakistani authorities took place on Monday in Islamabad, as the IMF delegation held separate meetings with finance ministry officials.
The introductory session of the first phase of talks was held by Finance Advisor Dr Abdul Hafeez Sheikh. The IMF delegation met with Sheik Reza Baqir, governor of Pakistan’s state bank, and Nosheen Javed, acting chairman of the Federal Revenue Board (FBR).
Speaking to the media, Sheikh said Pakistani rupee has stabilized, funding for the Kafalat program has doubled, while international investors are arriving as well.
Speaking about inflation, the finance advisor said several decisions were made to curb inflation. The government has granted Rs7 billion subsidy to utilities stores and 72 per cent of consumers of electricity receive subsidy, he informed.
In January 2020, the National Consumer Price Index (CPI) experienced a rise of 14.6 percent year-on-year (YoY) compared to the same period of 2019, as reported by the Pakistan Bureau of Statistics (PBS) monthly analysis of price indices.
The IMF staff team would hold discussions with Pakistani authorities until February 14 and the discussion at the technical level would be followed by discussions at the policy level. The mission would assess implementation of Pakistan’s agreed economic targets for a facility worth US$6 billion.
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When the first review of Pakistan’s economic performance was completed in December, the IMF recognized that Pakistan’s reform program is on track and already yielding results.
Decisive policy implementation has begun to resolve Pakistan’s economic problems and reverse its major imbalances, maintaining financial stability, the US-based fund said in its report. The report acknowledges that the country’s business situation has improved, and there is a return to market confidence.
The IMF issued SDR 328 million (around $452.4 million), bringing total disbursements to SDR 1,044 million (around $1.45 billion). If talks succeed this time, Pakistan will receive $450 million.