- “UAE will play role for Pakistan’s economic stability”, IMF envoy.
- Pakistan faces an external financing gap of $6.5 billion.
- Islamabad may seek help from WB, ADB and IDB.
The United Arab Emirates (UAE) – a time-tested friend of Pakistan – once again came to the rescue of the cash-strapped country amid tough times as it assured the International Monetary Fund (IMF) mission on the country’s external financing gap. Gave.
According to geo newsThe development came during a meeting on Tuesday between the IMF mission chief and the UAE Ambassador to Pakistan on the sidelines of the ongoing policy-level talks between the international lender and Islamabad regarding the first review of the $3 billion standby arrangement. SBA).
IMF delegation meets UAE envoy to confirm availability of external financing to Pakistan.
Sources revealed that Pakistan’s $6.5 billion external financing gap and other issues were discussed in the meeting.
During the meeting, the UAE envoy assured IMF officials that his country would play a role in Pakistan’s economic stability. IMF mission meets UAE envoy to confirm availability of external financing to Pakistan.
Amid ongoing policy-level talks, the global lender agreed to keep the annual tax target unchanged at Rs 9.415 trillion. Sources said the caretakers have informed the IMF that they will not impose any new taxes.
He further said that the caretakers have decided to approach Saudi Arabia, UAE and other friendly countries as the cash-strapped country faces a huge financing gap of $6.5 billion.
The country can seek help from Islamic Development Bank, Asian Development Bank and World Bank.
It is pertinent to mention here that with the commencement of policy-level talks, Pakistan and the IMF agreed to modify the fiscal and external framework to secure staff-level agreement under the $3 billion SBA, reported news On Tuesday (today).
The policy-level talks will end tomorrow (Wednesday). The Washington-based lender has so far expressed concerns over the exchange rate in the context of a free market-based mechanism, meeting all the necessary dollar inflows and increasing electricity and gas tariffs.
The current account deficit is expected to narrow, so some import compression will be used to reduce the external financing gap.
The government will have to increase the gas tariff as per the calculations made by the regulator. Electricity tariffs will have to be increased in line with fuel price adjustments and quarterly tariff adjustments. The FBR’s envisaged tax collection target was proposed to remain unchanged at Rs 9.415 trillion. However, the IMF has sought a Plan B in case of revenue shortfall in the current financial year.
In a separate meeting, caretaker Prime Minister Anwar-ul-Haq Kakkar approved five key steps to reform the taxation system and broaden the tax base by bringing 1.5 million new taxpayers into the tax net.