Pakistan nears finalisation of IMF loan agreement: Power Minister announces positive progress

Power Minister of Pakistan, Khurram Dastgir, announced that the country is close to sealing a deal with the International Monetary Fund (IMF) and that the agreement has been achieved on almost all the issues between the two sides.

With a $350 billion economy, Pakistan is in need of a crucial installment of $1.1 billion from the IMF to avoid default. However, the IMF has identified a significant gap of approximately Rs900 billion, equivalent to 1 per cent of the country’s Gross Domestic Product (GDP), which has been a hindrance in reaching a staff-level agreement.

Minister Dastgir reassured that the IMF has not demanded the government to cut its defense budget during his appearance on the Geo News program “Capital Talk” on Monday.

The Minister stated that instead of cutting the defense budget, the IMF has asked the Energy Division to reduce its losses. The Fund has also emphasized the need for the government to reduce line losses in the northern, southern, and western regions of the country. The Minister emphasized that the IMF has made it clear to Pakistan that the country must establish its financial stability by increasing its tax revenues and reducing losses.

He also mentioned that the international community is not displaying leniency towards Pakistan since the US withdrawal from Afghanistan. The Minister indicated that the country must take the necessary measures to align its financial position and meet the expectations of the IMF and the international community.