Today Last Day For IMF And Pakistan Deal , It Could Be Delay On Dependability Of Foreign Loans

ISLAMABAD: The credibility of the government’s assurances and the dependability of foreign loans committed by other nations, which delayed the handover of the Memorandum for Economic and Financial Policies (MEFP), were the two most pressing issues discussed on Wednesday by Pakistan and the International Monetary Fund (IMF).

At the PM House, Finance Minister Ishaq Dar and IMF Mission Chief Nathan Porter met behind closed doors, away from the eyes of the media. To avoid the media, the location of the meeting was moved from the finance ministry to the PM House.

The government was unable to persuade the mission chief to share the draft of the MEFP, which would have provided it with a real taste of what the IMF thought about Pakistani authorities’ presentations over the past nine days.

A senior official claims that the finance minister and IMF mission chief’s meeting “was good and assurances (were) exchanged.” However, no government official was certain that Pakistan would be able to obtain the MEFP today (Thursday) and sign it simultaneously. The document was still a distant possibility.

According to high-ranking government sources, there is a significant external financing gap of at least $4 billion that needs to be filled by China, Saudi Arabia, and the United Arab Emirates (UAE) in the form of additional support by June.

Pakistan was being requested by the lender to accept these nations into its fold.

A participant in negotiations with the IMF claims that there is still no convincing plan that could guarantee at least $7 billion for debt repayment, money for financing the current account deficit, and raising the low foreign exchange reserves to a respectable level.

According to the sources, there was also disagreement regarding the goal of net international reserves.

Hamed Yaqoob Sheikh, Secretary Finance, who serves as the primary intermediary in the talks, stated, “The mission chief called on the finance minister and briefed him about the talks. The mission is working on putting it all together and will finalize the MEFP.”

The secretary of finance stated that discussions with the IMF continued on Wednesday and focused on the fiscal table and financing. She added that there was a broad consensus regarding the reform measures and actions.

When speaking with journalists, Dr. Aisha Ghaus Pasha, Minister of State for Finance, stated that the IMF would not share the draft of the MEFP until there was complete clarity regarding a few remaining issues.

She added, however, that the government could not raise power tariffs beyond a certain point in order to alleviate burdens on the average person.

A day before the talks are scheduled to end, Pasha stated, “We are very close to finalising the negotiations,” but the nation has not yet seen the key policy document.

Even if the IMF hands over the MEFP today (Thursday), it will take a lot of time to read through each figure and paragraph of what is supposed to be a large report and then commit to it the same day. If the government rushes, it might end up signing a deal that it won’t be able to keep two months later.

Even if a staff-level agreement was reached prior to departure, sources stated that the IMF could set some prior actions for calling its board meeting.

They claimed that the credibility of Pakistan’s promises was also a problem because the IMF kept reminding them of previous promises that had not been kept.

An anonymous negotiator stated, “We are ready to commit to what the IMF is asking, but the IMF does not trust our words.”

According to sources, mishandling of the IMF talks appeared to be a regular occurrence, with a new revelation that the minister of state for petroleum kept the IMF mission chief waiting for approximately an hour during one of the meetings this week. Dr. Musadiq Malik did not respond to inquiries.

According to sources, there were still some issues with the gas and power industries that needed to be resolved on the final day.