IMF reaches staff-level agreement with Pakistan

ISLAMABAD (92 News) – The International Monetary Fund (IMF) and Pakistan reached a staff-level agreement on policies and reforms needed to complete the second review on Thursday. According to a statement from Mission Chief for Pakistan Ernesto Ramirez Rigo, the IMF had arrived at a staff-level agreement with Pakistan on the policies and reforms needed to complete the second review of the authorities reform program supported under the EFF. The policies and reforms will be subject to approval by the IMF management and Executive Board which is expected in early April. “Completion of the review will enable disbursement of $450 million,” the statement stated. A couple of weeks ago, the IMF said in an end-of-mission press release pertaining to its 10-day talks with the government that Pakistan had made considerable progress via sound economic policies over the past few months. “Considerable progress has been made in the last few months in advancing reforms and continuing with sound economic policies,” the global financial body had said. The IMF had further noted in its statement that all end-December performance criteria were met and structural benchmarks have been completed and in terms of performance, Pakistan had achieved all economic targets. According to the sources, the video conference talks requested the postponement of new taxes and postponement of tax rebates to the federal budget. The decision will be made by the IMF Executive Board. Electricity rates have been requested according to the cost of production. Power companies were requested to increase the collection of arrears and enable line losses to be compensated by bringing between 9 and 12 per cent. In order to receive a new surcharge on electricity bills, the Parliament asked for more time to pass the amendment bill in the NAPRA Act. As per the financial needs of the gas companies, more time was sought for the increase in gas prices, while excluding domestic consumers, the remaining areas have been requested to abolish the gas subsidy.