ISLAMABAD, May 5: The government has assured the IMF to privatize the Industrial Development Bank of Pakistan (IDBP) in 2003-04 for which the bank has been disallowed to take any high- cost deposits or make new loans.

Official sources told Dawn here on Monday that the potential cost of the required balance sheet cleanup of the IDBP will be included in the new budget.

The IMF was assured that the financial sector reform will be pursued during the next financial year and that the restructuring of National Bank of Pakistan will continue, with further gradual increases in the private sector share in equity. Also by June 2003, a decision will be taken on the strategy vis-a-vis disposal of 49 percent government stake in Allied Bank of Pakistan (ABL).

The Fund officials, sources said, were informed that Zari Taraqqiati Bank, formerly known as Agricultural Development Bank of Pakistan (ADBP) has been corporatized and was being restructured in the context of the Asian Development Bank’s supported rural finance development project.

Pakistan government also assured the Fund officials that given the growing involvement of the private sector in wheat marketing, the stock of outstanding commodity operations (government-guaranteed bank credit extended to various pubic commodity boards) will be reduced to Rs 95 billion by June 2003 and to Rs 85 billion by June 2004.