ISLAMABAD: Amid economic challenges, Finance Minister Miftah Ismail held his first one-on-one meeting with Prime Minister Shehbaz Sharif to discuss fiscal measures regarding upcoming budget, financial relief to the inflation-hit nation and loans for reviving the national economy.
The state news agency reported that PM Shehbaz Sharif Friday held a meeting with Finance Minister Miftah Ismail and discussed measures for providing relief to people. The premier expressed his satisfaction that the price of sugar was reduced after three years, which brought relief to people.
He issued directions to provide cash credit to Pakistan Agricultural Storage and Services Corporation (PASSCO) for buying wheat. The finance secretary was also present.
Sources told News360 that the Pakistan Muslim League Nawaz (PML-N) is facing severe economic challenges after coming into power as it has to unveil the new budget for the fiscal year 2022-23 next month besides taking effective measures to provide relief to the masses.
They added that the PML-N government faced failures to get desired financial benefits from the ally countries including Saudi Arabia, United Arab Emirates (UAE) and Qatar despite PM Shehbaz Sharif’s foreign visits.
Miftah-IMF talks
Miftah Ismail did not get any positive response from the International Monetary Fund (IMF) after seeking an increase in the size and duration of its $6 billion extended loans during his visit to Washington for holding talks last month.
It came after the fund said Islamabad has agreed to roll back subsidies to the oil and power sectors ahead of a resumption next month of a review of the IMF’s support for the country, according to Reuters.
“I’ve requested the fund and I think they have, largely, they’ve agreed to extend this programme for another one year,” he said. “I’ve also requested that they enhance the funding available to Pakistan from $6 billion under this programme to perhaps a little bit more.”
The details will be decided when the mission comes to Pakistan in May, he said.
“Based on the constructive discussions with the authorities in Washington, the IMF expects to field a mission to Pakistan in May to resume discussions over policies for completing the 7th EFF review,” the IMF said in a statement, referring to its Extended Fund Facility programme.
This covers $6 billion of support the IMF agreed in 2019 to extend to Pakistan. Payment of the funds has been slowed down several times because of IMF concerns over monetary policy and fiscal tightening measures.
The IMF also said the Pakistani authorities had requested to extend the EFF arrangement through June 2023 after the talks in Washington agreed to drop the subsidies.
From April to June, Pakistan will be giving more than $2 billion of subsidies to the oil and power sectors.
With a widening current account and foreign reserves falling as low as $10.8 billion, the South Asian nation is in dire need of external finances.
A new Pakistani government that took over this month from ousted Prime Minister Imran Khan said it was facing enormous economic challenges, with the risk of GDP growth falling and double-digit inflation it blames on the mismanagement of the previous administration.
Finance minister Ismail said before leaving for Washington that to revive the IMF programme, Islamabad would cut both ordinary expenditure and its funding for development projects.
It seemed that the premier’s foreign visits to Saudi Arabia and the UAE remained unsuccessful to get any exceptional financial benefits, whereas, Hamza Shahbaz has also come up empty-handed from Qatar.