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Indian Express
24-05-2025
- Business
- Indian Express
IMF says talks with Pakistan on budget ‘constructive', commits to continue talks
The International Monetary Fund (IMF) said on Saturday that it held 'constructive discussions' with Pakistani authorities on the upcoming budget while committing to continue talks in the coming days. The IMF team started high-level policy talks in Islamabad on May 19 to discuss the FY 2025-26 budget, which went on for days but apparently were inconclusive, forcing the government to delay the announcement of the budget till June 10. 'We held constructive discussions with the authorities on their FY2026 budget proposals and broader economic policy, and reform agenda supported by the 2024 Extended Fund Facility (EFF) and the 2025 Resilience and Sustainability Facility (RSF),' the IMF's mission chief Nathan Porter said in a statement. 'We will continue discussions towards agreeing over the authorities' FY26 budget over the coming days,' the statement added. The current discussions were focused on actions to enhance revenue, including bolstering compliance and expanding the tax base and prioritising expenditure. 'The authorities reaffirmed their commitment to fiscal consolidation while safeguarding social and priority expenditures, aiming for a primary surplus of 1.6 per cent of GDP in FY2026,' Porter said. He added that talks covered ongoing energy sector reforms aimed at improving financial viability and reducing the high-cost structure of Pakistan's power sector as well as other structural reforms which will help foster sustainable growth and promote a more level playing field for business and investment. The government emphasised its commitment to 'ensuring sound macroeconomic policy-making and building buffers,' according to the statement. 'In this context, maintaining an appropriately tight and data-dependent monetary policy remains a priority to ensure inflation is anchored within the central bank's medium-term target range of 5–7 per cent,' Porter stressed. 'Rebuilding foreign exchange (FX) reserve buffers, preserving a fully functioning FX market, and allowing for greater exchange rate flexibility are critical to strengthening resilience to external shocks,' added Porter. The IMF also said that its next mission associated with the next EFF and RSF reviews was expected in the second half of 2025. Pakistan and the IMF signed a USD 7 billion EFF loan last year and the country so far received two tranches, including the second one disbursed this month. The IMF executive board approved the fresh assistance to Pakistan notwithstanding New Delhi's apprehensions that the funds could be used for cross-border terrorism. On May 16, India's Defence Minister Rajnath Singh pressed the Washington-based global lender to reconsider the financial assistance, saying Islamabad could use a large part of it to fund the terrorist infrastructure.
Time of India
24-05-2025
- Business
- Time of India
IMF in 'constructive discussions' with Pakistan over upcoming budget, next review expected in second half of 2025
The International Monetary Fund said that it was in talks with Pakistan, holding 'constructive discussions' focused on the FY2025-26 budget and key economic reforms. The IMF team began high-level policy talks on 19 May in Islamabad and are expected to continue in the coming days. However, with no final agreement reached, its government pushed back the announcement of the budget to 10 June. The negotiations are part of Pakistan's ongoing efforts to secure continued support under the IMF's loan arrangements. 'We held constructive discussions with the authorities on their FY2026 budget proposals and broader economic policy, and reform agenda supported by the 2024 Extended Fund Facility (EFF) and the 2025 Resilience and Sustainability Facility (RSF),' said Nathan Porter, the IMF's mission chief, in a statement quoted by PTI. The current round of talks revolved around revenue enhancement, including better tax compliance and expanding the tax base, alongside prioritising expenditure. "The authorities reaffirmed their commitment to fiscal consolidation while safeguarding social and priority expenditures, aiming for a primary surplus of 1.6 per cent of GDP in FY2026," Porter said. Highlights of the discussions Energy and sustainability: Energy sector reform was high on the agenda. Porter said that these discussions aimed towards reducing the cost structure of Pakistan's power sector and improving its financial stability, moves seen as vital to economic sustainability and investor confidence. Need for macroeconomic structure: The IMF highlighted the importance of a sound macroeconomic framework, saying that maintaining an 'appropriately tight and data-dependent monetary policy remains a priority to ensure inflation is maintained within the bank's medium-term target range of 5–7 per cent. Forex restructure: Porter also raised the need to rebuild the country's foreign exchange reserves and support a fully functioning exchange rate market. Rebuilding foreign exchange reserves, maintaining a well-functioning forex market and increasing exchange rate flexibility are essential for boosting resilience against external shocks, he said. The IMF said its next mission to Pakistan, as part of the upcoming EFF and RSF reviews, is expected in the second half of 2025. Pakistan signed a $7 billion extended fund facility with the IMF last year and has received two tranches so far, including the most recent disbursal earlier this month. The approval came despite objections from India's objections that the funds may be diverted to finance cross border terrorism. On 16 May, defence minister Rajnath Singh urged the IMF to rethink the support, claiming that the funds could be diverted by Islamabad to boost its terror activities. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Business Recorder
24-05-2025
- Business
- Business Recorder
IMF, govt to continue FY26 Budget discussions ‘over the coming days'
An International Monetary Fund (IMF) mission led by Nathan Porter concluded its staff visit to Islamabad, which began on May 19, 2025. The staff visit focused on recent economic developments, program implementation, and the budget strategy for fiscal year (FY) 2026, which is scheduled to be announced on June 10, 2025. 'We held constructive discussions with the authorities on their FY2026 budget proposals and broader economic policy, and reform agenda supported by the 2024 Extended Fund Facility (EFF) and the 2025 Resilience and Sustainability Facility (RSF),' said Porter, in a statement 'The authorities reaffirmed their commitment to fiscal consolidation while safeguarding social and priority expenditures, aiming for a primary surplus of 1.6% of GDP in FY2026. 'Discussions focused on actions to enhance revenue, including by bolstering compliance and expanding the tax base, and prioritize expenditure. We will continue discussions towards agreeing over the authorities' FY26 budget over the coming days,' he said. Agreed EFF conditions: Any deviation could affect future reviews The IMF said discussions also covered ongoing energy sector reforms aimed at improving financial viability and reducing the high-cost structure of Pakistan's power sector. Other structural reforms will help foster sustainable growth and promote a more level playing field for business and investment. Moreover, the authorities also emphasised their commitment to ensuring sound macroeconomic policy-making and building buffers. In this context, maintaining an appropriately tight and data-dependent monetary policy remains a priority to ensure inflation is anchored within the central bank's medium-term target range of 5–7%. Pakistan 'met all targets', received board consensus for fund release: IMF At the same time, rebuilding foreign exchange reserve buffers, preserving a fully functioning FX market, and allowing for greater exchange rate flexibility are critical to strengthening resilience to external shocks. 'The mission thanks the federal and provincial authorities for their hospitality, constructive discussions, and strong collaboration and commitment to sound policies. 'The IMF team will remain engaged and continue its close dialogue with the authorities. The next mission associated with the next EFF and RSF reviews is expected in the second half of 2025,' read the statement.
Arab News
11-02-2025
- Business
- Arab News
In unprecedented development, Pakistan chief justice meets visiting IMF team
KARACHI: In a rare development on Tuesday, an International Monetary Fund (IMF) delegation visiting Pakistan met the country's chief justice for discussions on judicial reforms, accountability and the recent controversial restructuring of a commission that recommends judges for Pakistan's superior courts. The finance ministry said on Sunday a three-member IMF mission would visit Pakistan in the coming week to conduct a Governance and Corruption Diagnostic Assessment under the country's 2024 Extended Fund Facility program for a $7 billion loan. The ministry said the mission's report would recommend actions for addressing corruption vulnerabilities and strengthening integrity and governance, with the findings helping to shape structural reforms. On Tuesday, the Supreme Court said in a press release the IMF team led by Joel Turkewitz had met with Chief Justice Yahya Afridi. The statement quoted the CJ as saying he would be 'quite guarded' in his comments to the IMF team and the judiciary was 'not used to direct interaction with such missions,' but it was taking place on the request of the finance division. 'He then highlighted key Constitutional developments with respect to the Judicial Commission of Pakistan and reforms, including senior-level judicial appointments, judicial accountability, and the restructuring of the Judicial Commission of Pakistan (JCP). He elaborated on the merits of integrating the judiciary and the parliamentary committee to ensure a more transparent and efficient judicial selection process,' the SC statement said. Discussions during the meeting also centered on judicial accountability and mechanisms for addressing complaints against judges. 'The Chief Justice emphasized the importance of a robust and fair accountability process to uphold the integrity and independence of the judiciary,' the statement said. The finance ministry statement on Sunday had said the focus of the visiting mission would be to 'examine the severity of corruption vulnerabilities across six core state functions.' 'These include fiscal governance, central bank governance and operations, financial sector oversight, market regulation, rule of law, and Anti-Money Laundering and Combating the Financing of Terrorism,' it read. The finance ministry said the IMF had long provided advice and technical assistance to foster good governance such as promoting public sector transparency and accountability. 'Traditionally the IMF's main focus has been on encouraging countries to correct macroeconomic imbalances, reduce inflation, and undertake key trade, exchange, and other market reforms needed to improve efficiency and support sustained economic growth,' the finance ministry said on Feb. 9. 'While these remain its main focus in all its member countries, however the IMF has found that a much broader range of institutional reforms is needed if countries are to establish and maintain private sector confidence and thereby lay the basis for sustained growth.' The IMF identified that promoting good governance in all its aspects, including ensuring the rule of law, improving the efficiency and accountability of the public sector, and tackling corruption, 'are essential elements of a framework within which economies can prosper,' the ministry said, welcoming the IMF's technical support and saying the assessment would aid efforts to promote transparency and institutional capacity. The South Asian country, currently bolstered by a $7 billion IMF facility granted in September, is navigating an economic recovery. The IMF is set to review Pakistan's progress by March, with the government and central bank expressing confidence about meeting its targets.
