Pakistan completes legislative process for revival of $6 billion IMF program

Pakistan's Finance Minister, Shaukat Tarin, presenting the State Bank (Amendment) Bill at Senate in Islamabad, Pakistan, on January 28, 2022. (Photo courtesy: @SenatePakistan/Twitter)
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Updated 29 January 2022

Pakistan completes legislative process for revival of $6 billion IMF program

  • The IMF executive board is scheduled to meet for Pakistan's sixth review on February 2
  • Opposition says government has mortgaged country's economic sovereignty to the IMF

ISLAMABAD: With the passage of the State Bank (Amendment) Bill from the Senate, the Pakistani government on Friday completed the legislative process for the revival of a stalled $6 billion International Monetary Fund (IMF) bailout program to support the fragile economy and avert a balance-of-payment crisis. 

The government had the Finance (Supplementary) and State Bank of Pakistan (Amendment) bills passed by the National Assembly on January 13 to secure the next tranche of the IMF's Extended Funds Facility. The Finance Act, commonly known as mini-budget, is already enforced while the central bank autonomy bill required approval of the Pakistani parliament's upper house to become a law. 

The passage of these bills from parliament was a pre-requisite for the disbursement of around $1 billion from the IMF. The global lender’s executive board is scheduled to meet on February 2 for Pakistan's sixth review under the $6 billion program. 

The State Bank (Amendment) bill has been a major source of contention between the government and the opposition as the latter believes the legislation would compromise Pakistan's economic sovereignty. The government has been of the view that an autonomous central bank would help boost economic growth and stability in the country. 

“By facilitating domestic economic stability, the amendments will help support sustainable growth and avoid repeated booms and busts that have characterized Pakistan's past and led to painful consequences in terms of higher inflation, higher poverty and lower growth,” the bill reads. 

On Friday, opposition parties protested when Pakistani Finance Minister Shaukat Tareen presented the bill in the Senate, saying the government was going to “mortgage” Pakistan's economic sovereignty to the IMF. The bill was passed with a majority of one vote, with all amendments proposed by the opposition rejected. 

Interestingly, the opposition has a majority of at least 14 votes in the Senate, but some of its members were absent in Friday's session.  

The government said the amendments in the central bank legislation were in line with international best practices and took ground realities in Pakistan into account. 

Shortly after the passage of the bill, opposition members held a press conference and vowed they would withdraw this legislation after coming into power. 

“The joint opposition is not in favour of this bill and it will be withdrawn after whichever party of us comes into power,” said Senator Sherry Rehman of the Pakistan Peoples Party (PPP). 

Senator Azam Nazir Tarar, a member of the Pakistan Muslim League-Nawaz (PML-N) opposition party, said some of the opposition members could not attend the session due to COVID-19. 

“The days of this government are numbered,” he said, adding the government had “mortgaged the country's economic sovereignty to the IMF.” 

The revival of the IMF program would make available $1,059 million that would bring total disbursements to Pakistan to about $3,027 million and help unlock significant funding from bilateral and multilateral partners. 

Pakistan secured the $6 billion Extended Funds Facility in 2019, which has been stalled since March 2021. 

Pakistani mountaineers missing overnight on Nanga Parbat spotted descending to camp

Updated 6 sec ago

Pakistani mountaineers missing overnight on Nanga Parbat spotted descending to camp

  • 20-year-old Shehroze Kashif became youngest person ever to summit Nanga Parbat this week
  • Separately, Pakistani Imran Shamshali from Hunza was killed during an expedition on Gasherbrum

ISLAMABAD: Pakistani mountaineers Shehroze Kashif and Fazal Ali, who were reported missing overnight on Pakistan’s Nanga Parbat, were spotted descending to a camp on the mountain on Wednesday, according to Kashif’s social media accounts.  

Kashif, 20, who hails from Pakistan’s eastern city of Lahore, became the youngest Pakistani in May 2021 to scale Mount Everest, the highest mountain in the world. Earlier this month, he became the youngest person to summit Mount Kanchenjunga in Nepal, and on Tuesday, yesterday, the youngest person to summit Nanga Parbat. 

Ali, who hails from Shimshal of Hunza district of Gilgit-Baltistan in Pakistan’s north, was also reported missing with Kashif after getting stuck in a blizzard, according to the Alpine Club of Pakistan. 

“Shehroze Kashif and Fazal Ali are seen descending from Camp 4 to Camp 3 on Nanga Parbat 8,126m,” Kashif’s Twitter account said, adding that the two had spent the night in the open to wait for the weather to clear before beginning their descent. 

“The duo is showing great resilience and willpower to manage things themselves in death zone and now approaching Camp 3 soon,” read the post. 

In a video statement on Tuesday, Kashif’s father appealed to Pakistan’s army chief to launch a rescue operation to retrieve his son, saying Nepalese climbers were ready to launch an operation if they were provided helicopters.  

“I request the army chief: what are we waiting for? What are we waiting for,” he asked, pointing out that his son had paid tribute to the soldiers of the Pakistan Army after summiting the world’s third-highest mountain peak, Kangchenjunga, in Nepal. 

“He has achieved a lot, he has made Pakistan proud. Please launch a [rescue] operation.” 

Separately, the Alpine Club of Pakistan confirmed that Imran Shamshali, a Pakistani mountaineer from Hunza, was killed during an expedition on the Gasherbrum, a remote group of peaks in Pakistan’s northeast area, while another climber, Muhammad Sharif, had been missing since Tuesday.

Pakistan police arrest TV journalist on outskirts of capital

Updated 06 July 2022

Pakistan police arrest TV journalist on outskirts of capital

  • Arrest comes weeks after a court in Islamabad ordered police not to arrest him
  • TV anchorperson Imran Riaz Khan known for publicly supporting former PM Imran Khan

ISLAMABAD: A prominent Pakistani TV anchorperson known for publicly supporting former Prime Minister Imran Khan was arrested Tuesday on the outskirts of the capital, his colleagues said.

It was unclear on what charges police arrested Imran Riaz Khan, who is not related to the ex-premier.

The arrest of the TV journalist comes weeks after a court in Islamabad ordered police not to arrest him and several other journalists after complaints were lodged accusing them of inciting hatred against the military.

There was no immediate comment from the government.

Khan, the former premier, took to Twitter to condemn the arrest of the anchorperson.

Khan was ousted as prime minister through a no-confidence vote in the parliament in April. He contends his removal was part of a US plot, a charge Washington denies. 

Pakistan, GCC expected to hold technical talks for free trade agreement by July-end — official

Updated 06 July 2022

Pakistan, GCC expected to hold technical talks for free trade agreement by July-end — official

  • Last year, Pakistani and GCC officials resumed talks on a delayed FTA after a gap of almost 12 years
  • The South Asian country currently has free trade agreements with China, Malaysia, and Sri Lanka

KARACHI: Pakistan and the Gulf Cooperation Council (GCC) are expected to hold the second round of technical-level talks for a Free Trade Agreement (FTA) in the last week of July, a senior Pakistani diplomat said, with local traders saying a deal would help boost exports to the six-country bloc comprising the United Arab Emirates (UAE), Saudi Arabia, Bahrain, Oman, Qatar and Kuwait. 

Last year, Pakistani and GCC officials resumed talks on a delayed FTA after a gap of almost 12 years. The South Asian country currently has free trade agreements with China, Malaysia, and Sri Lanka.

“First technical round is completed, tariff lines lists have been shared between Pakistan and GCC, and the private sector and FBR [Federal Board of Revenue] are analyzing these tariff lists,” Azhar Ali Dahar, Minister Trade and Investment at the Embassy of Pakistan in Riyadh, told Arab News on Tuesday.

“GCC has asked for a second technical meeting and the commerce ministry is waiting for a response from private sector. It is expected that in the last week of July this second meeting may take place.”

Pakistani industrialists and traders said the FTA was very important for the country to increase multilateral trade volumes, and the apex body of the private sector, the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), was “fully involved” in pushing forward the process.

“Our Research and Development is working on it and we want to take it forward in a better way that is good for Pakistan,” FPCCI president Irfan Iqbal Sheikh told Arab News on Saturday. 

“FTA is very important if you need to enhance your trade, but we have to keep in view all aspects, including economic value and our economic conditions, before signing the agreement so that we [Pakistan] could benefit.” 

The FPCCI president said the FTA was important to tap markets other than the traditional EU, United States and United Kingdom, where Pakistan exports around 80 percent of its goods. 

“We have not yet tapped the other markets.. and we want to tap the other markets.. we want to work with GCC,” Sheikh added. “New markets and products that would increase Pakistan’s exports … that is what we need.”

The FTA with the GCC has remained in the cold storage since the signing of the Framework Agreement (FA) on August 26, 2004 in Islamabad. Only two rounds were held between 2006 and 2008. 

The first round of negations took place in Riyadh in March 2006 where both sides agreed to jointly declare the establishment of a Trade Negotiating Team (TNT). The parties also agreed to concessions in services under the World Trade Organization’s framework. 

The second round of negotiations was also held in Riyadh from September 7-8, 2008, where both sides agreed to a broader outline in the areas of Market Access in Goods & Services, Rules of Origin and some General Provisions, according to the Dahar in Riyadh.

“The FTA with GCC should have been signed much earlier because these are major economies, especially the UAE is our major trading partner, as our high-end imports are mostly coming from UAE,” Dr. Vaqar Ahmed, a joint executive director at the Sustainable Development Policy Institute (SDPI), told Arab News.

“We have been engaged with GCC countries since 2008 and still after a lapse of around 15 years this [FTA] has not materialized … we discuss with them security and other issues but FTA remains off the agenda.

“Now it must be on top of the agenda and the joint working group needs to set the deadline to finalize the FTA as we did in case of FTA with China,” he added. “Our exports, mainly services, are being processed from UAE where companies, especially the IT companies, have set up backend offices. We have a big advantage with the FTA so this needs to be taken very seriously.”

Pakistani investors in GCC countries have also called on their home government to aggressively pursue GCC authorities for the FTA.

“Pakistan has very special relations with GCC countries and they have been supportive. The FTA will largely benefit Pakistani traders through ease of tariff and non-tariffs measures,” Muhammad Iqbal Dawood, a director at the Pakistan Business Council Dubai, told Arab News via phone from Dubai. 

“Currently, India is going on the top of the countries signing FTAs ... We need to aggressively move on and sign these kinds of agreements.” 

Pakistani experts said the country had a limited list of products to offer the GCC bloc but the government should demand zero or reduced import duties on certain goods from Pakistan.

“We should demand zero or reduced customs duty from GCC for textile and garments, on processed food, rice, leather, sports and surgical goods,” SDPI’s Ahmed said. “In the services sector, we want incorporation fee waiver for example for our IT companies that set up back-end offices in Dubai, Doha, and Bahrain.”

“In return we should be very open about what we can offer them, we would not be in a position to restrict flow of goods coming from there as recently we have done to restrict imports,” he added, referring to recent ban on the import of luxury items to save foreign reserves. “We should be prepared that this would be reciprocal.” 

Pakistan issues fresh guidelines for Eid Al-Adha as COVID-19 cases rise

Updated 05 July 2022

Pakistan issues fresh guidelines for Eid Al-Adha as COVID-19 cases rise

  • Pakistan has had very few COVID-19 cases in recent months and did away with almost all precautions
  • In 24 hours, Pakistan recorded 653 positive cases, nearly double the number at the start of last Monday

ISLAMABAD: The National Command and Operation Center (NCOC), Pakistan’s federal pandemic response body, on Tuesday issued fresh guidelines for Eid Al-Adha, urging people to follow standard operating procedures (SOPs) as coronavirus cases rise across the country.

Pakistan has had very few COVID-19 cases in recent months and did away with almost all precautions.

But over the past 24 hours, the country recorded 653 positive cases, nearly double the number at the start of last Monday, according to NIH data. Over 162 people were reported to be in critical care.


“Eid UI Adha prayers should be organized in open spaces under stringent COVID protocols. In case of any compulsion to offer the prayers inside mosques, then all windows and doors should be kept open for ventilation / to minimize the chances of disease spread,” the NCOC said in a statement.

The body said up to three Eid prayers should be organized at a single venue with staggered timings to allow maximum people to offer prayers with COVID-19 protocols in place.

“All ulemas leading Eid prayers should be sensitised to keep sermons ... short so that people remain present in the prayer venues for a brief duration,” the guidelines said. “Efforts should be made to discourage sick, elderly and young children from attending Eid prayers.”

People without face masks should not be allowed to enter the prayer venue, the NCOC said, adding that prayer venues should have multiple entry and exit points and venue organizers should ensure the availability of hand sanitisers.

“It should be mandatory for all coming for prayers to use sanitisers before entering the venue,” the guidelines said.

“To ensure social distancing protocols, venue organizers to ensure prominent marking (6 feet apart) to allow sufficient space/distance between individuals. People should be encouraged to perform abulution at home before coming for the prayers and also bring their own prayer mats to the venue. Efforts should be made to sensitise people to refrain from embracing and handshaking after the prayer to avoid chances of disease transmission. There should not be any gathering at the prayer venue before the prayer and people should be asked to disperse immediately after the prayer.”

The NCOC said efforts would be made to promote and encourage central and collective sacrifices through various public, private and community organizations, while ensuring adherence to COVID-19 protocols of mask-wearing, social distancing and avoidance of crowds.

Pakistan approves imports in local currency from neighboring Afghanistan

Updated 05 July 2022

Pakistan approves imports in local currency from neighboring Afghanistan

  • The move is mainly aimed at buying coal to help ease energy shortages
  • Pakistan has shortage of forex reserves to buy LNG, oil in international market 

ISLAMABAD: Pakistan on Tuesday approved imports from neighboring Afghanistan in exchange for local currency, a move mainly aimed at buying coal to help ease an energy shortage.
The decision was taken in a meeting of Pakistan’s Economic Coordination Committee (ECC), a finance ministry statement said.
The ECC approved amendment in the Import Policy Order 2022 “to allow import of goods of Afghan origin against Pak Rupee” for a period of one year, it said.
The move is aimed at importing Afghan coal for Pakistan as it faces an energy crises due to a shortage of foreign reserves to buy LNG or oil in the international market to run its power plants.
Prime Minister Shehbaz Sharif announced plans last week to import coal from Afghanistan using local currency to save foreign reserves.
Islamabad has already announced an easy visa regime for Afghan nationals to help facilitate trade on both sides of the border. An Afghan finance ministry spokesman did not immediately respond to request for comment.
Customs duties from coal exported to Pakistan are a key source of revenue for cash-strapped Afghanistan. Sanctions on the banking sector and the cut in development aid since the Taliban took control last August year have severely hampered its economy.
No country has officially recognized the Taliban government, which has meant international financial assistance has dried up while Afghanistan faces a humanitarian and economic crisis.
The Afghan Taliban have lately stepped up coal exports to Pakistan to generate more revenue from its mining sector in the absence of direct foreign funding.
Kabul has raised duties on sales and increased rates recently.
Pakistan has also been facing an economic crises, with foreign reserves falling as low as hardly enough for 45 days of imports.