The United States (US) has agreed to help Pakistan negotiate a deal with the International Monetary Fund (IMF).
According to media reports, Pakistan’s Ambassador to the United States Masood Khan met Assistant US Trade Representative (USTR) for South and Central Asia Christopher Wilson to discuss expanding trade relations between the two countries and encouraging US investments in Pakistan.
Pakistan has not yet received the first draft of a memorandum of financial and economic policies (MEFP) from the IMF as targeted earlier because certain matters remained unsettled. “We are working very closely with the IMF and will soon reach some conclusion,” a top finance ministry official told Dawn.
Pak govt asks US to help with IMF deal
Last week, Pakistan asked for the support of the US for the revival of the IMF programme, reports Shahbaz Rana for The Express Tribune.
The Shehbaz-led government’s economic team met with US Ambassador Donald Blome and sought Washington’s support and acknowledgement of the actions taken.
According to the news outlet, Finance Minister Miftah Ismail and Minister of State for Finance Dr Aisha Pasha met with the US envoy.
The government is making all-out efforts to revive the programme and has taken many unpopular steps, but still remains short of the IMF’s expectations.
The IMF not only wants a reversal of the cut in the income tax rates for the salaried class but is seeking to pass on an additional burden of Rs125 billion on the salaried people. The government has now worked out a new proposal that entails reversing Rs47 billion tax relief and then passing on an additional burden of Rs18 billion to the salaried class, reports Shahbaz Rana.
The Tehreek-e-Insaf (PTI) led- government had committed to increasing the taxes on the salaried class with effect from July and also agreed to share the draft of the personal income tax reforms with the IMF by end of February 2022. However, PTI did not fulfil its commitments.
Minister of State for Finance Dr Aisha Pasha said that there was now more clarity to the IMF on the new budget, hoping to sign a deal very soon.
On Wednesday, the federal government increased the price of all petroleum products, including Rs24 per litre for petrol and Rs59.16 per litre for high-speed diesel (HSD). In less than a month, this is the third hike.
Miftah Ismail criticised the previous PTI government for reaching an erroneous agreement with the IMF, which tied the incumbent’s hands and forced it to raise oil prices to get the economy back on track.
