KARACHI: An International Monetary Fund (IMF) mission is expected to visit Pakistan this month to discuss a new programme, the lender said on Sunday, ahead of Islamabad beginning its annual budget-making process for the next financial year.

The IMF, however, did not specify the dates of the visit, nor the size or duration of the programme.

Pakistan last month completed a short-term $3 billion programme that helped stave off sovereign default, but the government of Prime Minister Shehbaz Sharif has stressed the need for a fresh, longer term programme.

“A mission is expected to visit Pakistan in May to discuss the FY25 budget, policies, and reforms under a potential new programme for the welfare of all Pakistanis,” the IMF said in an emailed response to Reuters.

Accelerating reforms more important than the size of fresh programme, Fund says

As Pakistan’s financial year runs from July to June, its budget for fiscal year 2025, the first by Sharif’s new government, has to be presented before June 30.

“Accelerating reforms now is more important than the size of the programme, which will be guided by the package of reform and balance of payments needs,” the IMF statement said.

Pakistan narrowly aver­ted default last summer, and its $350 billion economy has stabilised after the completion of the last IMF programme, with inflation coming down to around 17pc in April from a record high 38pc last May.

It is still dealing with a high fiscal shortfall and while it has controlled its external account deficit through import control mechanisms, it has come at the expense of stagnating growth, which is expected to be around 2pc this year compared to negative growth last year.

Earlier, in an interview, Finance Minister Moha­mmad Aurangzeb said the country hoped to agree the contours of a new IMF loan.

Pakistan is expected to seek at least $6 billion and request additional financing from the Fund under the Resilience and Sustain­ability Trust.

Published in Dawn, May 6th, 2024