ISLAMABAD: Pakistan’s finance minister Ishaq Dar on Friday said the International Monetary Fund’s decision to delay the bailout program for the country was “totally unfair,” adding the global lender had also contributed to the economic turmoil in his country.
Dar presented the federal budget for the next fiscal year earlier in the day with a total outlay of Rs14.46 trillion ($50.4 billion). Prior to that, the government was holding negotiations with the IMF to unlock a stalled loan program which it desperately needed to shore up foreign currency reserves.
As the finance minister unveiled the country’s fiscal plan, analysts widely said the government’s tax collection targets were “unrealistic” while expressing fear that the international lending agency would not accept the budget.
Speaking to a local news channel, however, Dar said the IMF had no reason to object to the new budget since the numbers presented on Friday were “better than what the government had sent it during this week.” He added the “undue delay” by the IMF in signing the staff-level agreement with Pakistan had pushed the country toward economic turmoil.
“The IMF is one of the main contributors to the economic turmoil in Pakistan along with political instability,” he told Geo News. “This is geopolitics. I can’t say much on camera, but the ninth review [of the $6.5 billion loan program] should have been completed by February. Its delay was totally unfair treatment toward Pakistan.”
The minister maintained global institutions like the IMF should “not corner Pakistan.”
Asked if the lender was not releasing the funds due to trust issues it had developed with the country, he said that he blamed the policies of the previous, Imran Khan-led, government for sabotaging the deal with the IMF.
“The trust eroded because of the previous government’s antics,” he continued. “The previous regime made a sovereign commitment in 2019-20, but it failed to implement it. Whatever little [decisions] they implemented were also reversed. That’s what led the IMF to deal with us in this way.”
Prime Minister Shehbaz Sharif said earlier today Pakistan had not only accepted all conditions laid forth by the global lender but also implemented the prior actions that it required from the country.
“Still, the staff-level agreement has not been signed,” he said in a speech made before the cabinet ahead of the budget announcement. “Now, the matter will go to the IMF board for review.”
“We must hope that, as we have fulfilled all the conditions, the IMF ninth review will be completed this month after seeking approval from the lender’s board.”
Sharif added he had recently spoken to the managing director of the international lending agency over the phone and had asked her for “verbal” assurances related to the release of the next tranche.
“I suggested to her that if she provided me with a verbal commitment [regarding the signing of the agreement], we would take a few more steps the lender had asked for. Once we received the verbal commitment from her, we took those steps too, so now, no other [requirements] are left that could turn out to be an impediment in signing this deal.”
