IMF Team ‘Literally Grilled’ Pakistan For Claiming To Have Met Lender’s Targets: Report – News18

The visiting International Monetary Fund (IMF) team to Pakistan led by mission chief Nathan Porter and his other colleagues on Friday expressed their displeasure that the Pakistan finance ministry announced in its official handout that they had met all structural benchmarks and other targets before the global lender could begin its review.

It expressed unhappiness over the Pakistan finance ministry’s announcement where it claimed that it materialised all structural benchmarks, quantitative and indicative targets even before the IMF staff there could scrutinise and complete the review.

Porter and his team were in Pakistan to complete the review process under the $3 billion Standby Arrangement (SBA) programme which they just began and were about to come up with the suggestions only after they could analyse the official data of various sectors of the national economy.

On Wednesday, the Pakistan finance ministry announced in its official handout that they had met all structural benchmarks and other targets.

Reports by The News and GeoTV claimed that the review mission literally grilled the finance ministry team in the maiden session of the review talks. It also said that the Pakistan officials were clueless regarding how to respond.

Pakistan’s newly-chosen finance minister Muhammad Aurangzeb, who was also the former chief executive officer of Pakistan’s biggest bank by deposits — Habib Bank Ltd, responded by saying he took note of the incident and such an episode would never be repeated in future.

Pakistan and the International Monetary Fund (IMF) started discussions to finalise the second review and reach an agreement on the Memorandum of Economic and Financial Policies (MEFP) following which the release of the last tranche of $1.1 billion is expected before the Fund’s Executive Board in the second week of April 2024.

An official said that a mini-budget cannot be ruled out. “The possibility of any mini budget cannot be ruled out at the moment, so the IMF may come up with prescriptions of raising rates of different taxes, especially General Sales Tax (GST) in order to fetch additional revenues on an instant basis. It will only become affirmative if the FBR faces any shortfall in achieving the tax collection target,” officials were quoted as saying by The News.

The IMF team and the finance ministry also discussed the possibility of meeting the quarterly target from April to June, which is crucial for achieving the annual tax collection objective of PKR 9,415 billion.

Moreover, they emphasised the importance of devising a strategic plan within the energy sector to mitigate the ongoing issue of circular debt accumulation.