Pakistan-IMF talks on bailout package extended after 'good progress' in discussions

Published May 10, 2019
The technical level talks between Pakistan and the IMF on the proposed bailout package were expected to conclude today. — Photo courtesy Ministry of Finance/File
The technical level talks between Pakistan and the IMF on the proposed bailout package were expected to conclude today. — Photo courtesy Ministry of Finance/File

The technical level talks between Pakistan and the International Monetary Fund (IMF) on the proposed bailout package that were expected to conclude today were extended for another two days on Friday.

"We have made good progress in our discussions with the visiting IMF Mission. Consultations will continue over the weekend," a brief statement issued by the finance ministry said.

Sources told DawnNewsTV that a deadlock remains on some issues being discussed between the two sides, which they said is expected to be settled over the course of the next two days.

Islamabad and the IMF mission had kicked off technical level talks on April 29 to sort out details of the proposed bailout package over the next 10 days. The two sides were scheduled to conclude a staff-level agreement today.

Read: IMF talks progressing, says Hafeez

A source at the finance division had told Dawn that after the successful technical level talks Pakistan would sign an agreement with the IMF latest by May 10. The agreement would then be sent to the IMF board, the source had added.

The proposed bailout package is expected to be $6-8 billion.

During their discussions on Wednesday, the government and IMF had agreed that the country would withdraw tax exemptions amounting to Rs700 billion within two years.

As per the understanding, the government will start withdrawing exemptions offered in various taxes amounting to around Rs350bn in the budget for 2019-20.

The finance ministry had approached the IMF in August 2018 for a bailout package, whereas last month, the then finance minister Asad Umar announced that the two sides had — more or less — reached an understanding on a package for bailing out the country’s ailing economy.

“In the next step, the IMF will send its mission to Pakistan in the next few weeks to work out technical details. But in principle, we have reached an agreement,” he had said. However, Umar was removed from the post in a dramatic move and was replaced with Dr Abdul Hafeez Shaikh — an internationally renowned economist.

Dr Shaikh served as the finance minister from 2010 to 2013 during the PPP government's rule. During his tenure as federal minister, Dr Shaikh completed 34 sale transactions worth Rs300 billion in banking, telecom, electricity, and manufacturing.

Subsequently, an IMF employee Dr Reza Baqir was appointed governor of the State Bank of Pakistan (SBP) to serve for a three-year term. The chairman of the Federal Board of Revenue was also changed in a sudden move.

Follow Dawn Business on Twitter, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

Course correction
Updated 24 Feb, 2024

Course correction

PTI should not abandon its power and responsibility while expecting an external stakeholder to set things right.
The plot thickens
24 Feb, 2024

The plot thickens

THE recent explosive allegations by Liaquat Ali Chattha, the former commissioner of Rawalpindi, have thrust the...
Trigger-happy police
24 Feb, 2024

Trigger-happy police

ARE the citizens of Karachi becoming fair game again? There were some grisly signs of a rapid return to living...
What next for PTI?
Updated 23 Feb, 2024

What next for PTI?

THE incoming government has been carved up. With the major offices apportioned between the PML-N and PPP, the...
Tackling debt
23 Feb, 2024

Tackling debt

MANY would tend to describe a new report warning that the country is headed for “inevitable default”, which will...
Imprisoned abroad
23 Feb, 2024

Imprisoned abroad

THE issue of Pakistani prisoners imprisoned in foreign jails crops up regularly, particularly during parliamentary...