PAKISTAN has completed almost all pre-conditions for the revival of the stalled programme of the International Monetary Fund (IMF) but the lender is still non-committal as to when exactly the funds would be released. This became evident from the diplomatic posture adopted by IMF Director Middle East and Central Asia Department Jihad Azour who told members of the visiting Pakistani delegation in Washington that the staff level agreement would be signed ‘soon’ followed by the IMF Board’s approval. The official apparently asked Pakistan to do more as he hoped that Pakistan would continue towards its progress on the reforms in various sectors and complete the programme in time and “IMF will play its positive role in bringing economic stability in Pakistan”.
There is no doubt that Pakistan is engaged with the IMF for stability of its shattered economy and the government carried out a series of measures in line with its understanding with the Fund but the deliberate delaying tactics being used are adding to the uncertainty and compounding economic and financial woes of the country. Pakistan is keen to finalize the deal as it will unlock other bilateral and multilateral financing avenues for the country to shore up its foreign exchange reserves that have fallen to four weeks’ worth of import cover, and help it steer out of a balance of payment crisis. However, the Fund is insisting that the country should secure commitments of external inflows ahead of signing of the staff level agreement. Finance Minister Ishaq Dar, who was previously scheduled to visit Washington to attend meetings with the World Bank and the IMF, is staying back due to internal political developments and participated in the meeting electronically. He told the IMF official that all prior actions for the 9th review under the Extended Fund Facility have already been completed and the government is fully committed to fulfilling its obligations as agreed with the IMF. As the internal situation is very fluid and anything could happen anytime, there are genuine apprehensions that the agreement might not be concluded ‘soon’ as hoped by the IMF and both the government and people should be ready for further belt-tightening which is the only available option left in the given situation.
