Unable to reconcile and evolve consensus on the Memorandum of Economic and Financial Policies (MEFP), the International Monetary Fund (IMF) and Pakistan have so far failed to strike a staff-level agreement under $ 6 billion Extended Fund Facility (EFF), reported local media. Islamabad expects the finance secretary to prolong his stay in Washington DC for the next few days for making last-ditch efforts to reconcile and evolve consensus on the MEFP and completion of 6th and 7th reviews to pave way for the approval of $ 1 billion tranche under the EFF programme.
The IMF staff is still dissatisfied with Pakistan’s macroeconomic framework under the MEFP and without agreement over it, despite the government raising electricity tariff by Rs 1.39 per unit on average for baseline tariff, raising POL prices by Rs 10.49 for petrol and Rs 12.44 for diesel.
In the aftermath, the Imran Khan administration has asked Tarin to extend his visit to the US capital and make last-ditch efforts at gaining the IMFs nod.
Calling it a worrisome development, sources have said that the IMF staff was so far busy in number-crunching mainly on fiscal framework, external front and power sector.
On 15 october, the country’s government had increased the base power tariff by Pakistani Rs 1.39 per unit to fulfill IMF demand to stay in its programme. The increase will become effective from November and continue till the end of the financial year, June 2022, according to The News International.
News agency ANI reported that the IMF is dissatisfied with Pakistan’s macroeconomic framework, despite the Pakistan Prime Minister Imran Khan administration raising electric tariffs and POL prices.
Earlier in the month of June, Pakistan and the International Monetary Fund (IMF) held unresolved discussions over a sixth review of the $6 billion loan programme followed by a delay in the next tranche. Finance Minister Shaukat Tarin informed that the talks with the Fund over the sixth economic review remained inconclusive, followed by a delay in the next tranche.