Pakistan to complete prior actions through parliamentary nod by Jun 30 for IMF next bailout programme
May 23, 2024
Islamabad [Pakistan], May 23 : As the International Monetary Fund (IMF) mission is currently in Pakistan, the economically-crippled nation would have to complete a set of prior actions, mostly through binding parliamentary approvals and legislation within the next 40 days, i.e. June 30, to reach a formal staff-level agreement (SLA) with the global lender for its next bailout programme, reported Dawn.
After a fortnight-long dialogue winds down, the sources said that Pakistan authorities and an IMF staff mission, led by Nathan Porter had completed their engagements covering almost all critical sectors of the economy, including major reforms in the power and gas sectors, state-owned entities, pensions, revenue mobilisation and expansion, and monetary policy horizon in line with inflationary expectations.
Pakistan and IMF have reached a broad understanding of action points, their timelines and backup plans that the government would comply with through parliamentary sanction of budgetary measures and related legislation in the Finance Bill 2024-25.
"The fund wants a stamp of approval from parliament for the reform and policy actions, given the unpredictable political environment," an official said, adding that the mission would be flying out on Friday without announcing an SLA.
Moreover, the two sides have already had their customary goodwill receptions, according to Dawn.
The IMF mission would review the implementation of gas and electricity tariff adjustments and the beginning of their reform actions besides approval of taxation and trade tariff-related policy measures and amendments in tax laws through finance bill 2024-25, and on satisfactory compliance, they will formally announce SLA by end-June or early July 2024.
"Most probably online consultations would be enough for minor clarifications here and there after the budget is approved by the parliament and there would be no need for a follow-up mission," an official said.
"Review has been completed, the last leg of talks looks good so far, perhaps some performance benchmarks may be adjusted by the fund, nothing else and that too after the budget process is over," the official added.
The federal budget presentation in the parliament is almost final for June 7, as the Eidul Azha holidays would leave a very tight schedule for parliamentary debate, the official said, reported Dawn.
