‘Govt managed to reduce circular debt from 38 to 10 billion rupees’

ISLAMABAD (92 News) – The International Monetary Fund (IMF) has hailed the improvements in Pakistan’s economy as the government managed to reduce circular debt from 38 to 10 billion rupees in July this year. According to the Finance Ministry, the IMF stated that Pakistan’s reform program is on track and already producing results. In its latest report, the IMF conceded that the business climate has improved, and market confidence is returning. The report confirmed that inflation has been started to stabilize and the State Bank of Pakistan’s stance is appropriate. It said that the Pakistan economy has witnessed significant improvements, including stability in exchange rates for five months and appreciation in rupee's value. The report mentioned that the government managed to reduce circular debt from 38 to 10 billion rupees in July this year. It also said that the government too provided an additional budgetary allocation of 20 to 30 billion rupees to cover the 10 percent down payment by beneficiaries of affordable housing. Earlier, Pakistan received a $454 million second tranche from the IMF under a $6 billion Extended Fund Facility (EFF). The $454-million payment would be added to the country’s foreign exchange reserves, currently at $17.6 billion, by next week. The IMF approved the EFF installment last Friday, saying that the country’s programme was on track and had started to bear fruit. However, it had warned that the risks remained. The approval came from the IMF’s executive board, which had made its decision after completing the first review of Pakistan’s economic performance. Earlier, the IMF executive board completed the first assessment of Pakistan’s economic performance and approved $452 million for Pakistan. According to the press release, the IMF executive board has completed the first review of Pakistan’s economic performance. In a statement first deputy managing director and acting chair said that $452 million would be given to Pakistan. The IMF has said Pakistan’s economic reforms program is on track and has started to bear fruit. The IMF executive board made this observation following completion of its first review of Pakistan’s economic performance under the Extended Fund Facility. The world lender said that decisive policy implementation by Pakistani authorities is helping to preserve economic stability. It also noted that transition to a market determined exchange rate has been orderly and inflation has started to stabilize, mitigating the impact on the most vulnerable groups of the population.