ISLAMABAD: Pakistan's Finance Minister Ishaq Dar on Thursday blamed "geopolitics" for repeated delays in the resumption of Pakistan's $6.5 billion International Monetary Fund (IMF) program, local media reported, hours after the lender criticized Islamabad for failing to broaden tax net in the new budget.
The IMF and the Pakistani authorities have been negotiating with each other since last November to complete the ninth review of the loan program. However, they have not managed to make headway in ensuring the revival of the facility which is set to expire at the end of June.
Last week, Dar presented the budget for the next fiscal year with an outlay of Rs14.46 trillion ($50.4 billion), with the government targeting a 6.5 percent fiscal deficit and allocating around 50 percent of the amount to make interest payments.
Addressing the Senate standing committee on finance, Dar responded to the IMF country representative's criticism of the country’s new federal budget, saying Pakistan was a "sovereign" country and could not accept everything demanded by the IMF, Pakistan's Geo News channel reported.
“Pakistan is a sovereign country and cannot accept everything from the IMF,” he was quoted as saying. “Foreign hostile elements want Pakistan to turn into another Sri Lanka and then the IMF negotiate with Islamabad.”
The finance minister assured the committee that the government knew how much tax it needed to collect and form where the revenue could be generated.
About Pakistan’s external payments, he assured the country will not defer any foreign payments, according to the report.
“Pakistan does not need to go to Paris Club to reschedule loans,” he said. "We will manage external payments of Pakistan."
Pakistan has for months been facing an acute balance of payment crisis, with its forex reserves barely enough to cover a month's imports, inflation skyrocketing and local currency depreciating fast.
The South Asian country still has to draw around $2.5 billion from the IMF, though it remains uncertain due to inconclusive negotiations and the content of the latest budget.
