ISLAMABAD, Oct 17: The International Monetary Fund (IMF) has advised Pakistan to control the rising inflation through good monetary policies. The advice came from the visiting six-member IMF delegation led by Managing Director Rodrigo de Rato in a meeting with Dr Salaman Shah, adviser to the prime minister on finance here on Monday.

Pakistan’s side included CBR chairman, secretaries of establishment, planning, economic affairs division and finance and economic advisor to finance division.

Mr Rato said that the Fund was encouraged due to changes in the tax structure, policies of liberalization, deregulation, privatization pursued by the government and financial sector reforms. Praising the economic progress of Pakistan, he said Pakistan was today economically strong and stable.

Referring to the anti-money laundering legislation, he said that Pakistan economic policies were good and comparatively better than neighbouring countries.

Briefing the delegation, Dr Salman said that major challenges before Pakistan were how to improve macroeconomic environment, bring debt situation under control, restore investor confidence, revive economic growth and restore financial sovereignty.

This, he said was made possible due to wide ranging bold structural reform and policies to strengthen the macroeconomic environment including fiscal responsibility and debt limitation law, deregulation, good governance, privatization, agriculture reforms and capital market reforms.

Dr Shah said Pakistan’s economy had made significant progress during the last six years. Fiscal and current account deficit had been lowered, the domestic and international debt burden declined, GDP maintained a robust upward trend, the overall fiscal deficit, which was 6.1 per cent to the GDP in 1998-99 was reduced to 3.3 per cent in 2004-05, the revenue collection and foreign investment increased, the inflation rate remained between 4.4 per cent to 4.5 per cent during the last four years.

He said that the public debt which was 91.7 per cent of GDP in 1990 came down to 61.7 per cent in 2005.