IMF to wrap up Pakistan bailout review once financing in place

The seal for the International Monetary Fund is seen in Washington, DC, on January 26, 2022. (AFP/File)
Short Url
Updated 31 May 2023
Follow

IMF to wrap up Pakistan bailout review once financing in place

  • Pakistan and the IMF have been discussing fiscal policy measures in the review since February
  • The aim is to resume stalled funding of $1.1 billion due in November from bailout signed in 2019

ISLAMABAD: The International Monetary Fund (IMF) is working with Pakistan to conclude a ninth review of a bailout program, its mission chief said on Friday of the funding critical for the cash-strapped nation to avert an economic collapse.

Pakistan and the IMF have been discussing fiscal policy measures in the review since February, aiming to resume stalled funding of $1.1 billion due in November from a $6.5-billion program agreed in 2019.

The measures have fueled highest ever inflation, posted at 36.4 percent in April.

The IMF funding is crucial for Pakistan to avert default on its external payment obligations during a balance of payment crisis, in which foreign exchange reserves have shrunk to just four weeks of controlled imports.

“The IMF continues to work with the Pakistani authorities to bring the ninth review to conclusion once the necessary financing is in place and the agreement is finalized,” mission chief Nathan Porter said in a statement to Reuters.

“The IMF supports the authorities in the implementation of policies in the period ahead.”

This included technical work to prepare the budget for fiscal year 2024, set to be passed by the National Assembly before end-June, he added.

As part of the conditions, Pakistan has given an assurance that its balance of payments gap this fiscal year, which ends in June, is fully funded.

Pakistan has announced pledges worth $3 billion in financing support from Saudi Arabia and UAE, but the funds have yet to come through. Longtime ally China has rolled over and refinanced its loans.

Islamabad and the IMF have had differences over the gap. It was not clear if the Saudi, UAE and Chinese financing would be sufficient, or if more external support would be needed.

It was also not immediately clear why the lender wanted to work on the technical preparation of the budget, which is not covered by the program.

The step could be linked to a possible new IMF lending plan, said Yousuf Nazar, an economist and former head of equities and investments at Citigroup.

“I think it is unavoidable that they would like to ensure the government will meet its commitments particularly, when it is in no position to repay the debt, which will inevitably need a new program,” he told Reuters.

Pakistan’s finance ministry and the IMF did not immediately respond to a request for a comment.

The current IMF program aims to disburse an additional $1.4 billion for Pakistan before it concludes in June.


Punjab expands Pakistan-India Wagah border arena with museum, partition-themed park

Updated 4 sec ago
Follow

Punjab expands Pakistan-India Wagah border arena with museum, partition-themed park

  • The border crossing, near eastern city of Lahore, is the primary land route between Pakistan and India and one of the most recognizable symbols of their often-tense relations
  • The site is best known for its daily flag-lowering ceremony, a choreographed military ritual performed by border forces from both countries that draws thousands of spectators

ISLAMABAD: Maryam Nawaz, chief minister of Pakistan’s Punjab province, on Thursday inaugurated the newly constructed arena at Wagah border cross between Pakistan and India, which includes a museum and a partition themed park.

The Wagah border crossing, located near the eastern city of Lahore, is the primary land route between Pakistan and India and one of the most recognizable symbols of the often-tense relationship between the two neighbors. It serves as a key point for prisoner exchanges and limited movement of travelers, while remaining tightly regulated due to security considerations.

The site is best known for its daily flag-lowering ceremony, a choreographed military ritual performed by border forces from both countries that draws thousands of spectators. Over the years, the ceremony has evolved into a popular tourist attraction, blending displays of nationalism with public spectacle and making it one of Pakistan’s most visited landmarks, which connects with India’s Attari.

Flanked by military officials, CM Nawaz visited the crossing and inaugurated the new arena, with its seating capacity increased from 7,500 to 25,000 spectators, the state-run Radio Pakistan broadcaster reported. The chief minister also visited the martyrs’ monument and offered her respects.

“In addition to the arena’s expansion, several new constructions have been added at the Joint Check Post Wagah. These new developments include a theme park depicting the partition of the Subcontinent, featuring models of a railway station, military equipment and a Martyrs’ Memorial,” the broadcaster reported.

“A Pakistan Museum has also been established within the arena, showcasing the country’s history and culture from the Freedom Movement to the present day.”

In August 1947, Britain divided the Indian Sub-continent, its former colony, into two countries — Hindu-majority India and Muslim-majority Pakistan.

Excitement over independence was quickly overshadowed by some of the worst bloodletting that left up to 1 million people dead as gangs of Hindus and Muslims slaughtered each other.

Creating two independent nations also tore apart millions of Hindu and Muslim families in one of the world’s largest peacetime migrations, which displaced at least 15 million people.

The fate of Kashmir, then a princely state, was left undecided. The Himalayan territory continues to remain a flashpoint in relations between the neighbors, who have fought multiple wars over it.