CT Newsroom/Monitoring Desk
International Monetary Fund (IMF) recently accepted to release a new fund of $7bn to Pakistan under strict conditions and Prime Minister (PM) Shehbaz Sharif had welcomed the move on Wednesday, September 25, 2024.
Reportedly, Shehbaz Sharif who is on foreign tour these days has expressed immense relief over the approval of a new $7bn loan from IMF.
The prime minister thanked IMF Managing Director (MD) Kristalina Georgieva and her team for approving the loan while saying that his team had been working and negotiating with IMF over the said loan for last three months.
It is important to mention here that IMF’s deal has come with some strict conditions that may ease the government’s financial problems but at the same time it will definitely create problems not only for the federal government but also for the provincial governments in giving relief to the people.
As per IMF’s deal with the government, IMF will monitor the expenditure of the provincial governments in future and there will be no further relief on electricity bills; just like the Punjab government did for the months of August and September.
As per details, Pakistan National Finance Commission (NFC) award formula will also be reviewed and the retail, agriculture, and property sectors will be brought to the tax net; in addition to that the federal government structure will also be reviewed and reduced.
Moreover, the government will not be able to determine the prices of food grains, and will not be allowed to give more than one percent subsidy to the energy sector. Further, the government will not be permitted to issue any supplementary grants during the IMF program.
As per IMF instructions, the federal government will bring reforms and a comprehensive package will be brought for the power purchase agreements.
Finance Minister Muhammad Aurangzeb, during an interview to Voice of America, said that IMF’ fund would not be possible without America and China’s support.
“We have brought agriculture, retail distribution, wholesalers, and real estate into tax net and we are going to impose such restrictions on non-taxpayers due to which they will not be able to perform certain important tasks, he added.
