Pakistan, IMF initiate policy-level talks on bailout amid deadlock over fiscal gap, new taxes

This handout photograph released by the Pakistan Press Information Department (PID) on January 31, 2023, shows Pakistan’s Finance Minister Ishaq Dar (L) meeting with a International Monetary Fund (IMF) review mission led by IMF mission official Nathan Porter (2R) at the Finance Ministry in Islamabad. (AFP)
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Updated 07 February 2023

Pakistan, IMF initiate policy-level talks on bailout amid deadlock over fiscal gap, new taxes

  • Successful talks with the IMF will unlock more than $1 billion in funding to cash-strapped Pakistan 
  • Economist says the government will have to jack up electricity and gas prices to ink the agreement 

ISLAMABAD: The Pakistani government and the International Monetary Fund (IMF) on Tuesday initiated policy-level talks to bridge differences on data regarding the budget deficit, taxation and measures required to overcome fiscal gaps, particularly in the energy sector. 

The IMF mission has been in Islamabad since January 31 following the government’s request to negotiate resumption of Pakistan’s $7 billion loan program, which has been stalled since November last year. 

In the first four days, the global lender and the government held technical talks, in which Pakistani officials shared the fiscal statistics, including development budget, external financing and energy sector data, with the IMF mission for its perusal. 

“The differences with the IMF still persist over numbers regarding the fiscal gap and need for new taxation through a mini-budget, but hopefully we will overcome it,” a finance ministry official with the knowledge of talks told Arab News, on the condition of anonymity. 

Islamabad is struggling to get the loan program revived to receive a tranche of more than $1 billion to stave off a balance-of-payments crisis after the nation’s foreign exchange reserves dropped to $3 billion, just enough to provide 18-day cover for imports. 

The official said the government was willing to generate an additional revenue of around Rs450 billion ($1.6 billion), but the IMF was pushing it for at least Rs840 billion ($3 billion) additional revenue to overcome the primary deficit. 

“We have agreed with the IMF in principle to slash our development budget too,” he said. 

Pakistan’s development budget is expected to be reduced to over Rs400 billion ($1.4 billion) this fiscal year from Rs727 billion. 

“The discussions on withdrawal of subsidy and measures to abolish energy sector debt will be held in the next two days,” the official said, hoping the two sides would reach an agreement on all issues by February 9. 

The Pakistani finance ministry and the IMF country representative did not respond to Arab News’s requests for comment. 

Pakistan is struggling to quell default fears in the domestic and international markets with the $1.1 billion bailout tranche as the South Asian country witnesses a decades-high inflation and depreciation in the national currency. 

The Pakistani currency has depreciated by more than Rs100 against the US dollar since January last year due to external repayment pressure, while inflation jumped to 27.5 percent year-on-year in January. 

Economists say it is imperative for the government to secure a staff-level agreement with the IMF by Thursday to complete the 9th revenue of $7 billion to ensure dollar inflows from multilateral partners, friendly countries and other bilateral sources to shore up the country’s foreign reserves. 

“As slippages from the budgeted amounts are considerable, adjustments in the prices of electricity and gas as well as in the fiscal sector would need to be done to ink this agreement,” Dr. Khaqan Najeeb, a former adviser to the finance ministry, told Arab News. 

“Some expenditure cuts would also be required to ensure that the primary deficit comes back to the agreed amount with the IMF.” 

Najeeb, however, hoped the IMF would be sympathetic to the plight of the people suffering from last year’s floods and double-digit inflation. 
 


Ex-PM says will approach foreign capitals, rights bodies over crackdown against supporters

Updated 12 sec ago

Ex-PM says will approach foreign capitals, rights bodies over crackdown against supporters

  • In latest address, Khan says he fears for his life, accuses government of plotting to kill him
  • PM Sharif accuses Khan of running ‘disgusting’ smear campaign against the army chief

ISLAMABAD: Former prime minister Imran Khan said on Monday his Pakistan Tehreek-e-Insaf (PTI) party would present evidence to international human rights organizations and foreign capitals of alleged rights violations committed by the Pakistani government against his supporters.

Khan’s supporters have had clashes with police a number of times in the last week, including on Saturday when he visited a judicial complex in Islamabad for a court appearance. Before that, supporters pelted police and other law enforcers with stones and bricks when they arrived outside Khan’s Lahore residence with court orders to arrest him in a case involving the sale of state gifts, popularly called the Toshakhana case.

Addressing supporters on Monday via video link, Khan said the government had wanted to isolate him from his supporters at the judicial complex and laid a "trap" to kill him, while police had fired tear gas shells to provoke his followers into a confrontation. He urged Pakistan's top court to take notice of the alleged human rights violations in Pakistan.

"We will approach international human rights organizations today," Khan said. "We will [also] approach foreign capitals through the PTI's chapters in various parts of the world.”

The ex-premier's statement came hours after Prime Minister Shehbaz Sharif accused Khan of orchestrating a "foreign-funded" campaign against Pakistan's army chief, Syed Asim Munir.
Sharif was responding to criticism leveled at Munir by PTI protesters who had gathered outside the White House in Washington D.C. on Sunday, many of them directly chanting slogans against the Pakistan army and its chief.

Khan accused the Sharif-led government of deliberately trying to pit the PTI against the country's powerful military.

"Let me emphasize, this army is my army and it is also my country," Khan said. "I will live and die in Pakistan."

Khan, widely believed to have been propelled to power in the 2018 general elections with the support of the army, has since said to have fallen out with the military. Kahn denies the polls were rigged in his favour, while the military says it no longer interferes in politics.


Pakistani envoy reminds Muslim community at UN of Ramadan’s message of compassion, tolerance

Updated 55 min 47 sec ago

Pakistani envoy reminds Muslim community at UN of Ramadan’s message of compassion, tolerance

  • Condoles with people who lost their loved ones in climate disasters in Muslim nations
  • Pays homage to Kashmiris and Palestinians “living through the yoke of occupation”

ISLAMABAD: In a message on the eve of Ramadan, Pakistan’s Ambassador to the United Nations, Munir Akram, reminded the Muslim community at the UN about the holy month’s teachings of compassion, patience and tolerance toward others and steadfastness in the face of hardships and calamities.

Ramadan is the ninth month of the Islamic calendar, observed by Muslims worldwide as a month of fasting, prayer, reflection and community.

The first fast in Pakistan is likely to be observed on Thursday, March 23, with the Ruet-e-Hilal committee, which sights the new moon and announces the start of Ramadan, scheduled to meet this Wednesday.

“I hope this month enshrines us with the need to always do good to others and ourselves,” Munir was quoted by state-run APP as saying.

“Ramadan is a month of exchanging gestures of compassion and empathy. It is a time for reflection, self-purification and learning. It is also a time to look after those in need and to uplift one another.”

“During this time, I would like to express my condolences to my Muslim brothers and sisters who lost their loved ones, and their homes in climate calamities, in particular during the devastating floods that affected Pakistan, Türkiye, and other parts of the world. The earthquake which affected southern Türkiye and northern Syria also incurred extensive loss of life and damage to properties,” the envoy added.

“I pray that May Almighty save us from the menace of such mega-disasters in the future.”

The ambassador also paid homage to Kashmiris and Palestinians “living through the yoke of the occupation.”

“I would also like to extend my gratitude to our peacekeepers in UN missions abroad who are working diligently in difficult circumstances and I express my tribute to the fallen peacekeepers in the line of duty. May Allah grant their soul peace and give fortitude to their families and loved ones.”


'Separate elections unconstitutional': Govt trying for same-day vote, says Sana

Updated 20 March 2023

'Separate elections unconstitutional': Govt trying for same-day vote, says Sana

March 20: Express Tribune reported interior Minister Rana Sanaullah has claimed that the upcoming polls in two provinces – Punjab and Khyber Pakhtunkhwa – would be unconstitutional as they would lead to the next general elections not being held under caretaker setups in these provinces. Read More I


Sharif blames ex-PM Khan for ‘intolerable’ smear campaign against Pakistan’s army chief

Updated 20 March 2023

Sharif blames ex-PM Khan for ‘intolerable’ smear campaign against Pakistan’s army chief

  • PM Sharif urges “patriotic overseas Pakistanis” to raise their voices against “foreign-funded” campaign
  • PTI supporters, in demonstration outside White House on Monday, urged military to accept civilian supremacy

ISLAMABAD: Prime Minister Shehbaz Sharif on Monday criticized his predecessor Imran Khan for orchestrating a “foreign-funded” campaign against Pakistan’s army chief, Syed Asim Munir, saying that it is being launched against him by using overseas Pakistanis.

The prime minister’s statement comes a day after hundreds of Khan’s Pakistan Tehreek-e-Insaf (PTI) supporters gathered outside the White House in Washington D.C. to protest against what they said were “atrocities” being committed against Khan. In the protest, a PTI leader demanded that Pakistan’s powerful military establishment must realize the “mistake” it is making while another supporter said the military should accept civilian supremacy in the country.

The protest took place a couple of days after clashes between Khan supporters and Punjab police personnel who attempted to arrest the former prime minister outside his Zaman Khan residence in Lahore on court orders.

Munir was appointed army chief by PM Sharif in November last year. The army chief’s appointment became a subject of controversy after Khan — who challenges the legitimacy of the Sharif government — insisted Pakistan’s ruling coalition government should not appoint the new army chief. Rather, he insisted elections be held and a new prime minister should appoint the army chief.

“Campaign against the army chief is intolerable and a continuation of the conspiracy against institutions,” Sharif said in a statement. “Patriotic overseas Pakistan should raise their voices against this foreign-funded campaign,” he said, adding that overseas Pakistanis are being used to spread “toxic politics.”

Sharif appealed to overseas Pakistanis not to fall prey to the alleged conspiracy, adding that Khan was violating the constitution by dragging the heads of institutions in his “dirty politics.”

“The interior minister should deal with iron hands against those who are running dirty campaigns against institutions within the country,” Sharif said. “Strict legal action should be taken against those who instigate chaos, riots, and rebellion in Pakistan.”

The prime minister said a campaign against an army chief, who had been appointed on merit for the first time in Pakistan’s history, could only be the agenda of enemies of the state. “The nation stands with its institutions and is united against miscreants,” he added.

In separate tweets later, PM Sharif accused Khan of orchestrating a “disgusting smear campaign” against Pakistan’s army chief.

“PTI’s disgusting smear campaign against Chief of the Army Staff General Asim Munir at the behest of Imran Niazi is deserving of the strongest condemnation,” Sharif wrote on Twitter.

In another Twitter post, the premier said Khan is “stooping to unprecedented lows” for power and is undermining Pakistan’s armed forces.

The PTI chairman, who has severely criticized Bajwa and accused him of having a hand in his removal from office in April 2022, has largely refrained from criticizing Munir directly. However, in an interview earlier this month, Khan said he expected Munir’s appointment would “change” his and his party’s fortunes but added that “hardships have increased.”

Pakistan’s military has historically held massive sway in the governance and foreign policy matters of the nuclear-armed South Asian nation. Over the past couple of years, the army, which has ruled Pakistan for nearly half of its 75-year history, has come under intense criticism, arguably unprecedented for the all-powerful institution, particularly for its role in politics.

In his farewell speech, Bajwa said the military had decided in February 2021 to quit any role in Pakistani politics. In a veiled warning to Khan, he also said the military’s patience has limits.


Almost half of Pakistan does not know how to ride a bicycle — Gallup survey

Updated 6 min 9 sec ago

Almost half of Pakistan does not know how to ride a bicycle — Gallup survey

  • Gallup Pakistan surveys 764 men and women across all four provinces
  • Answers were collected via telephonic surveys, says Gallup Pakistan

ISLAMABAD: The findings of a survey conducted by Gallup and Gilani Pakistan earlier this month said 45 percent of Pakistanis don’t know how to ride a bicycle.

The government in Pakistan’s southern port city of Karachi organized the “longest cycling race” on March 5. Almost 95 participants took part in the 35-km long race which started from the Quaid’s mausoleum in Karachi and ended at the Governor House. Though Pakistan has not won any significant world titles in cycling, the country hosts several cycling competitions in major cities across the year.

According to Gallup Pakistan, the survey was conducted on March 16 from a “nationally representative sample of adult men and women” across the country’s four provinces. Respondents were asked the question, “Please tell if you know how to ride a bicycle?”

Fifty-five percent of the respondents said yes while almost half, 45 percent, said no.

The survey was carried out among a sample of 764 men and women in urban and rural areas in the four provinces. The methodology used for data collection was telephonic surveys (CATI), Gallup Pakistan said.