Pakistan to Receive Additional $2 Billion from IMF

Speaking with IMF officials, a Finance Ministry official announced that the Fund would increase its $6 billion packages to $8 billion for Pakistan, a significant breakthrough in talks.

After “several meetings” with Pakistan’s Finance Minister, Miftah Ismail, in Washington, the lender has decided to send a mission to the country next month to assess the situation there.

According to Mr. Ismail, Pakistan has never defaulted in its more than 70-year history. Following his meetings with the International Monetary Fund. “The Government of Pakistan has never defaulted in its 70-year history, and it will never default in the future,” the minister reaffirmed.

She was joined by State Minister for Revenue and Financial Affairs, Dr. Aisha Ghaus Pasha, to speak to the media about former Prime Minister Imran Khan’s deals and commitments, which she said were with the country.

“We [the coalition government] are responsible for that and the loans Imran Khan took, we are responsible for that as well,” Finance Minister Ayaz Gilani told reporters in Washington.

He said that even the previous government’s CPEC commitments were now the new government’s responsibility.

Miftah, on the other hand, acknowledged that there were numerous budget deficits, adding that when this occurs, it is funded through loans. He said that the new government would try to reduce the debt-to-GDP ratio by increasing the latter.

“If our national income rises rapidly and loans do not rise rapidly, we are okay,” said Miftah.

This year, Miftah acknowledged that the debt-to-GDP ratio “should be low every single year.” So it’s fine, he said, even though this hasn’t happened in a single year if the trend continues in that direction.

Miftah stated that the new government’s goal would be to ensure that the country’s reserves are higher than what they inherited from their predecessors. Despite the IMF’s demand that the government reduces fuel subsidies, the Finance Minister said the government couldn’t do so.

The minister explained that that’s the amount of money the government gives him to fill up his car. Put another way: If he had 15 trucks traveling from Karachi to Islamabad with goods, at least 1,000 liters of gasoline would be used.

In another way, when the minister said the government gives him and his family “Rs. 50,000 in subsidies,” he meant that they get Rs. 750,000 in subsidies per person! ‘Remember one thing: in Pakistan, subsidies are given only to the wealthy. “This is a global problem, but the problem is more pronounced in Pakistan,” he said.

A kerfuffle will be caused, according to the Finance Minister, if he allocates Rs 400 billion to the Benazir Income Support Programme (BISP). “But you see how much money you’ve given to the rich,” Miftah remarked.

If “reserves” permit, he claimed, the government must decide whether or not to provide financial assistance for typical car owners.

“If your government is providing you with a two-for-one subsidy to run your vehicle. Do we have the money for it? Our government cannot afford this,” said Finance Minister Miftah Ismail. “I say ignore the IMF’s point.”