Finance Minister Muhammad Aurangzeb expresses hope for bailout to be country’s last IMF package
DNA
ISLAMABAD” Finance Minister Muhammad Aurangzeb has said that the country will secure an extended International Monetary Fund (IMF) programme on September 25, The News reported on Sunday.
Speaking at the CFA Society of Pakistan’s 21st Annual Excellence Awards, Aurangzeb expressed hope that it will be the country’s final IMF programme. However, he warned that failure to sustain reforms might lead to a 25th programme.
His remarks come as Islamabad reached an agreement with the Washington-based lender on a $7 billion 37-month loan programme in July earlier this year. However, the future of the bailout package is subject to the approval of the Fund’s executive board which is set to convene on September 25 with Pakistan included in its meeting agenda.
The country was required to secure external financing of $2 billion from bilateral and commercial lenders as a pre-requisite for the IMF board’s approval.
It is to be noted that Pakistan owes $5 billion to Saudi Arabia in the form of cash deposits, along with 4$ billion and $3 billion from China and the United Arab Emirates (UAE), respectively.
Speaking on the occasion, the finance minister stressed the need for macroeconomic stability and said that Pakistan has previously experimented with various economic models, none of which yielded the desired results.
On pensions, Aurangzeb announced that any new federal government employees would be required to contribute to a defined-contribution pension scheme. He stressed the need for Pakistan’s economic focus to shift from imports to an export-driven model.
The finance minster’s statement comes as the incumbent government is also set to introduce a mini-budget with an aim to generate around Rs650 billion in revenue, primarily by cracking down on tax evaders and increasing general sales tax (GST) on properties, tractors and other items.
Accepting another condition tabled by the global lender, the government had agreed to jack up valuation tables for real estate in 42 cities by the end of September 2024 so the Federal Bureau of Revenue (FBR) can notify the revised rates in the coming weeks.
The upcoming mini budget will be introduced after securing approval from Prime Minister Shehbaz Sharif and the federal cabinet.
Either the money bill will be laid down in parliament or a presidential ordinance will be promulgated but the final decision will be taken by the government after consulting with its political allies, especially the Pakistan Peoples Party (PPP).
