Talks with IMF enter final stage: Asad Umar

Asad Umar said at present the IMF was engaged in summer meetings with the World Bank.

ISLAMABAD (APP) – Finance Minister Asad Umar on Monday said negotiations with the International Monetary Fund (IMF) had entered the final stage with settlement of almost all the issues related to the signing of an agreement.

“We are very close to each other and there is no fundamental difference,” the minister said while talking to media-persons after launching the State Bank of Pakistan’s (SBP) Electronic Money Institutions (EMIs) Regulations here.

The minister said there were issues relating to timing and sequence, which had been resolved. Similarly, the main issue of how to reduce current account deficit had also been sorted out. Now there was no issue with unbridgeable differences, he added.

Asad Umar said at present the IMF was engaged in summer meetings with the World Bank and soon after the meetings, its mission would visit Pakistan to finalize the bailout package.

He said the IMF programme usually lasted for three years and it would disburse loan to Pakistan in three tranches. If the IMF sanctioned $6 billion package, Pakistan would get $2 billion during the current year and in case $9 billion, it would receive $3 billion as first tranche.

He, however, said the IMF’s loan amount would not matter. It was important that after the agreement, the world’s trust in Pakistan would be restored and it would be able to get more funds from the international bond market, he added.

With respect to aid from the friendly countries, the minister said Saudi Arabia had released its total pledged amount of $3 billion, China had transferred $2.1 billion, and the United Arab Emirates had also remitted $2 billion out of total committed amount of $3 billion.

China, he said, had also pledged to import goods worth $1 billion from Pakistan. All the formalities in that regard had already been finalized and the process to dispatch goods to China would begin during the current month, he added.

To a question regarding delay in the China Pakistan Economic Corridor (CPEC) projects, the minister said work on all the pending projects, including the multi-billion rupees ML-1 railway track, would start soon.

Asad Umar said shortfall in tax revenues during the current fiscal year was mainly due to the government’s efforts to curtail the current account deficit which resulted in significant decline in imports. About 40 percent revenue was generated from the imports.

With regard to increase in petroleum prices, he said the Oil and Gas Regulatory Authority (OGRA) had recommended increase in the petrol price by over Rs 11 per liter. However, the government allowed around Rs 6 per liter increase by slashing the tax rate, he added.

The minister attributed the increase in the prices of petroleum products to the rise in the international market along with devaluation of Pak rupee.

Increase in the inflation rate was mainly due to the fact that the government had to take harsh measures to improve the economy, which was on the brink of bankruptcy, he added.