Pakistan govt ‘assures’ IMF of expediting privatisation programme

Islamabad [Pakistan], March 18 (ANI): The Pakistan government has ‘assured’ the International Monetary Fund (IMF) of expediting the privatisation programme, reported ARY News, citing sources.

According to finance ministry sources, the privatisation of Pakistan International Airlines (PIA) is proceeding as per the plan and efforts are underway to complete the process soon.

They further said that the federal government has also prepared a plan to privatise power-sharing companies.

Moreover, the other loss-making state-owned enterprises, including First Women Bank, State Life Insurance, and Pakistan Engineering Company, are also on the list, ARY News reported.

According to the sources, Pakistan is expected to sign the Staff-Level Agreement with the IMF next week.

The signing of the staff-level agreement with the IMF will clear the way for Pakistan to receive the last tranche of USD 1.1 billion under the SBA Agreement, the sources added.

They further stated that during the talks with the IMF, Pakistan’s officials assured the international lender of jacking up the electricity tariff from July 1, while monthly, quarterly and yearly fuel adjustments will hit consumers for cost recovery, according to ARY News.

Earlier, the Pakistan government rejected the International Monetary Fund’s (IMF) demand for a National Finance Commission (NFC) Award revisit.

The IMF, citing the shortage of federal funds, asked Islamabad to revisit the NFC Award with the provinces during the second review talks under the USD 3 billion loan programme under SBA.

Reportedly, the IMF delegation is currently in Pakistan for the second review under the SBA loan programme, ARY News reported.

Amid the economic crisis, Pakistan is also expected to make a formal request to the IMF for a longer and larger bailout package under the Extended Fund Facility (EFF) next month.

The country is expected to seek a fresh IMF bailout package of over USD 8 billion with the possibility of augmentation through climate finance on the occasion of the upcoming spring meetings of Breton Wood Institutions, known as the IMF/World Bank, scheduled to be held in Washington, DC, from April 15 to 20.

There are two possibilities for Pakistan to request a longer and larger size of the EFF programme. The first is that the inflation-hit country may ask for its enhanced quota as it did in 2008 when Islamabad secured 700 per cent of its quota during the Pakistan Peoples Party (PPP) government.

The other possibility is to augment the EFF through a climate finance instrument, as Pakistan qualifies for it due to the worst climate degradation in the last few years.

Notably, Pakistan secured a USD 3 billion IMF stand-by arrangement last summer, however, the nation is still struggling with record inflation, currency devaluation and shrinking foreign reserves.