ISLAMABAD, Feb 5: The International Monetary Fund (IMF) has agreed to allow the Central Board of Revenue (CBR) to revise revenue collection target downward from Rs430 billion to Rs420 billion during 2001-2002.
Informed sources said here on Tuesday that the visiting IMF review mission headed by Klaus Enders had been convinced that due to continued reduction in imports specially customs duties, it was not possible to achieve twice downwardly revised target of Rs430 billion and that the CBR should be allowed to cut the target by another Rs10 billion.
The mission has completed first round of talks by meeting the government’s team headed by Secretary General Ministry of Finance Moeen Afzal, and other officials of the Planning Commission and the CBR. It arrived in the capital on January 31 and will stay in Pakistan till February 14 and during this period it was also expected to visit Karachi to meet the senior officials of the State Bank of Pakistan (SBP) including its Governor Dr Ishrat Hussain.
Sources said that the mission had been apprised about the revenue collection position and the reasons that would not help achieve Rs430 billion target. There had been roughly 40 per cent reduction in imports that caused low revenues.
The members of the review mission as well as Fund’s Senior Director for Middle East and South Asia Paul Chabrier who met the finance minister a few days ago in Islamabad, had agreed that Pakistan could not do any thing to mitigate the serious effects of September 11 carnage. However, they have warned that the Fund will not tolerate internal mismanagement and slippages and that the government should complete the much sought after restructuring of the CBR as quick as possible.
The sources said the review mission was also of the opinion that the government should take measures to remove corruption so that Pakistan could manage revenues worth 20 per cent of the GDP instead of existing 15 per cent.
The mission members are now scheduled to hold two meetings with the minister for finance to complete the review of the economy. The mission has also been asking the government to increase exports and accelerate the process of privatization.
The sources said that the government side informed the mission that all efforts were being made to have 9 billion dollar exports during the current financial year. Had there been no September 11 events, the government was sure of meeting its 10 billion export target, the mission was told.
Similarly, the officials said that a number of new transactions including that of the PTCL, Habib Bank, United Bank, Saudi Pak Fertilizer and government’s share holding in the oil and gas sector will be completed by May this year.