KARACHI: Pakistani Finance minister Shaukat Tarin on Wednesday denied the country was opting out of an International Monetary Fund (IMF) program, saying the government had approached the IMF to ask it to ease “tough conditions” on a $6 billion loan.
The International Monetary Fund Executive board approved the three-year loan package for Pakistan in July 2019 to rein in mounting debts and stave off a looming balance of payments crisis, in exchange for tough austerity measures. In March this year, the IMF said after the latest payment, Pakistan had received total disbursements of $2 billion under the Extended Fund Facility.
“If people think we are moving out of the IMF program.. we are not doing this,” newly appointed finance minister Tarin told journalists at a press conference in Islamabad. “We will ask them to give us some space amid the third wave of COVID.”
Tarin said the government had “alternate plans” if the IMF did not respond favorably to the request to relax conditionalities, adding that authorities had held meetings with IMF and World Bank officials on the current state of the economy, and they had been “very sympathetic to our point of view.”
Tarin said the IMF was asking Pakistan to increase power tariffs and impose incremental taxes, which it did not have the “capacity” to do “because our common man is fed up of inflation, which has cascading effects.”
“Tariff increase is not the only way to increase money,” Tarin said. “Prime Minister Imran Khan is not willing to do that.”
Tarin said IMF and World Bank officials had been briefed that revenue generation, which grew by 92 percent prior to the pandemic, had fallen to 57 percent after the outbreak.
The finance minister said the government had alternative plans to bring circular debt in check and stabilize the energy market.
“All their [IMF] interest is that our circular debt is growing, that should be ceased and some stability should be brought in. We will prove to them that the measures we will take will do it.. that will happen,” Train said.
About taxes, the finance minister said the government wanted to enlarge the revenue envelope through innovative means but gradually.
“As they [IMF] said in 2019 to raise [tax collection] directly from Rs 3.8 trillion to Rs 5.5 trillion, that will not happen,” he said, adding: “This is wrong way of doing – we have to increase gradually and in next 7-8 years we will be at the 20 percent … Will bring revenue collection close to their target but not the way they are saying, by ending exemptions etc.”
Pakistan says not opting out of IMF program but won’t raise power tariffs, taxes
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Pakistan says not opting out of IMF program but won’t raise power tariffs, taxes
- Finance minister Tarin said government had approached IMF to ask for more “space” to meet conditionalities on a $6 bln loan
- Says the government has “alternate plans” if the IMF did not respond favorably to the request to relax conditions
Pakistan consumer confidence rises by 4 percentage points in two years, survey shows
- Four in 10 Pakistanis believed the country is on the right track, with optimism higher among men
- Economic concerns remained most worrying, but their quantum fell drastically across all issues
ISLAMABAD: Consumer confidence in Pakistan has risen by 4 percentage points from 31.5 to 35.5 over the last two years, which highlights improving public optimism under the government’s tenure, Ipsos market research firm said in a recent survey.
The survey was conducted through computer-assisted telephonic interviews (CATI) and included more than a thousand participants from all provinces and Azad Kashmir and Gilgit Baltistan regions on Feb. 2-14.
It comes at a time when Pakistan has undergone a difficult period of stabilization, though international rating agencies have acknowledged improvements after Islamabad began implementing structural reforms as part of its $7 billion International Monetary Fund (IMF) program.
The Ipsos survey revealed a “measurable” improvement in Pakistan’s economic sentiment, marked by a decline in inflation alongside notable reductions in poverty and unemployment, since the current government took charge two years ago.
“These findings point to a clear two-year transformation in the Consumer Confidence Index, demonstrating the perceived impact of consistent governance and policy measures,” read the key takeout in the survey.
“Sustained performance, coupled with transparent communication of achievements, will be essential to maintain momentum, reinforce optimism, and support further improvements in economic confidence.”
Four in 10 Pakistanis believed the country is on the right track, with optimism higher among men, while confidence in the country’s direction being right increased more than three times, from 12 percent to 40 percent, since the government came to power, according to the survey.
Economic concerns remained most worrying, but their quantum fell drastically across all issues since the first quarter of 2024. Inflation has dropped by 23 percent, unemployment by 10 percent, poverty by 20 percent, electricity prices by 34 percent and the burden of additional taxes was reduced by 18 percent in Q1 2026 as compared to Q1 2024.
“One in 3 Pakistanis expect the economy to strengthen,” the survey read. “Confidence to invest has grown steadily over two years, rising from 11 percent to 16 percent, with even stronger optimism among urban residents.”
