Pakistan expected to pass first review of $7bn IMF loan: report

ISLAMABAD, MAR 5 (DNA)Pakistan is expected to successfully complete the initial assessment of its $7 billion loan programme with the International Monetary Fund (IMF), as it has taken sufficient steps to boost revenue, according to officials and diplomats cited by Bloomberg.

Islamabad secured the $7 billion Extended Fund Facility (EFF) last summer to help claw its way out of an economic crisis.

The programme has played a key role in stabilising Pakistan’s economy and the government has said the country is on course for a long-term recovery.

Prime Minister Shehbaz Sharif-led government has approved a law to tax agricultural income, attempted to sell a stake in state-owned Pakistan International Airlines and taken steps to meet an ambitious tax target, and have presented these developments to the IMF, the people said, asking not to be identified because the discussions are private.

An IMF team led by Mission Chief to Pakistan Nathan Porter is in Pakistan this week to meet with government officials and assess their progress in meeting the loan conditions.

If the IMF approves the first review of the loan, the country is in line to receive about $1 billion as the second instalment of the loan package. The IMF review is being closely watched by investors as a sign of progress in economic reforms.

PM Shehbaz told the global lender’s Managing Director Kristalina Georgieva last month his government plans to submit a plan to boost economic growth after achieving stability. The IMF chief said in an X post the lender was encouraged by Pakistan’s strong commitment and reforms.

Finance Minister Muhammad Aurangzeb told Reuters that Pakistan was “well positioned” for the first review of its $7 billion International Monetary Fund bailout programme as talks with the global lender began on Tuesday.

“They are here. We will have two rounds of talks, first technical and then policy level,” Finance Minister Muhammad Aurangzeb said.

“I think we are well positioned” for the review, he said.

The finmin, said in an interview last month, that the country will meet its revenue goals for the fiscal year to June and any shortfall will be met by expanding the tax net. He has separately said the nation is confident to meet other targets of the program.

Pakistan was able to build some trust with the IMF by completing a short-term nine-month programme last year. Previous loan programs in Pakistan ended prematurely or saw delays after the governments at the time faltered on meeting key conditions.